Due to the slack interest rates, which will continue for years, there will be no way around the stock market for investors who want returns above the inflation rate. There is no doubt that buying a stock index or a share involves price risks. Investment certificates, such as discount or bonus certificates on the most solid base possible, have offered investors disproportionately high potential returns for many years.
The share of the insurance group Allianz (ISIN: DE0008404005), whose management is optimistic about the future despite the COVID-19 crisis, can definitely be seen as a solid underlying. After the publication of quarterly figures that exceeded expert expectations, the share rose sharply in recent weeks.
Investment idea: Investors who want to achieve returns of more than five percent in the next 13 months, even if the Allianz share price falls to the lows of March 2020 in the region of 117.10 euros, could invest in a bonus Consider a certificate with a cap on the insurance share.
Apart from dividend payments, private investors who buy a share directly can only achieve positive returns if the share price rises. With bonus certificates with and without a cap, investors can achieve high annual returns not only when the share price rises, but also when prices stagnate or fall.
How it works: If the Allianz share never touches or falls below the barrier of 118 euros by the valuation date of the certificate, the bonus certificate will be repaid on December 24, 2021 at the bonus level of 205 euros.
The key data: The Société Générale bonus certificate with cap (ISIN: DE000SB30FZ8) on Allianz shares has a bonus level and cap of 205 euros. The cap defines the maximum repayment amount of the certificate. The barrier activated by the valuation date, December 17, 2021, is EUR 118. At the Allianz share price of 194.75 euros, investors could buy the certificate for 193.70 euros. The purchase of the certificate is therefore associated with a slightly lower capital expenditure than the direct purchase of the Allianz share.
The opportunities: Since the certificate is currently available at 193.75 euros, it enables gross income of 5.81 percent in just over 13 months if the share price never falls 39.41 percent to 118 euros or below by the valuation date .
The risks: If the Allianz share hits the barrier of 118 euros by the valuation date, the certificate will be repaid at the closing price of the Allianz share set on December 17, 2021. If the share trades below 193.70 euros on that day after touching the barrier, the certificate investment will yield a loss.
This article does not constitute a recommendation to buy or sell Allianz shares or investment products based on Allianz shares. No liability is assumed for the correctness of the data.
Note: PERSONAL-FINANCIAL.COM publishes analyzes, columns and news from various sources in this section. PERSONAL-FINANCIAL.COM AG is not responsible for content that is recognizably posted by third parties in the “News” area of this website and does not adopt it as its own. This content can be identified in particular by a corresponding “from” label below the article heading and / or by the link “To read the full article, please click here.”; The named third party is solely responsible for this content.