Cycle & turnaround – sideways returns with ThyssenKrupp columns

Cycle & turnaround – sideways returns with ThyssenKrupp

The sector rotation as a result of the breakthrough in the corona vaccine has given momentum to many cyclicals who previously only participated below average in the recovery trends – this also applies to ThyssenKrupp (DE0007500001). With improved demand from the automotive industry, positive momentum in the steel price and a possible European incentive from “green steel”, the SG analysts rate the company as a buy and give a 12-month target price of EUR 10.20. If that seems too optimistic, you can take a defensive entry with certificates and benefit from the high volatility of the share even in a sideways trend.

Discount strategy with 16 percent buffer (March 2021)

If you only want to position yourself at constant prices for a short time, you can achieve a maximum return of 0.43 euros or 28.6 percent pa on the UBS discount certificate with ISIN DE000UD7J982) with the purchase price of 5.57 euros, provided the share is on the valuation date (18.3.21) closes at or above the cap of 6 euros. The safety buffer is 16.9 percent.

Bonus strategy with 38 percent buffer (March 2021)

The bonus certificate with cap from BNP Paribas (ISIN DE000PF4EBQ3) has a bonus amount and cap of 7 euros. If the barrier of 4 euros (buffer 40 percent!) Is never touched or undercut by the valuation date (19.3.21), investors receive the bonus and maximum amount. At the purchase price of 6.66 euros, the maximum profit is 0.34 euros, which is a return of 18.4 percent p.a. corresponds. Attractive: The certificate is slightly cheaper than the share (small discount).

Income strategy with 10 percent buffer (June 2021)

The reverse convertible bond from HypoVereinsbank (ISIN DE000HZ3KDZ5) pays a coupon of 16.4 percent p.a. regardless of the price development. With the entry price at par, this also corresponds to the effective return. If the share closes at or above the base price of EUR 5.60 on the valuation day (6/18/21), investors also receive back the full nominal amount; otherwise you will receive delivery of 178 shares according to the subscription ratio (= EUR 1,000 / EUR 5.60).

CertificateReport conclusion: Attractive returns and comfortable buffers even with short terms – volatility makes it possible at ThyssenKrupp. The choice of the cap / the barrier / the base price is determined by the personal willingness to take risks and the return demand of the investors.

This article does not constitute a recommendation to buy or sell ThyssenKrupp shares or investment products based on ThyssenKrupp shares. No liability is assumed for the correctness of the data.

Author: Thorsten Welgen


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