Capital Protection Certificates

Capital Protection Certificates are an attractive investment form offering both security and potential for returns. They are particularly suitable for investors who want to protect their capital while simultaneously benefiting from the opportunities of the financial markets. In this article, we will take a closer look at the {0} issued on {1} with its valuation day coming up in {2} days. Furthermore, we will consider the underlying value, {3} ({4}).

What are Capital Protection Certificates?

Capital Protection Certificates are structured financial products that offer investors protection of their invested capital. This means that investors receive at least the nominal value of their invested capital at maturity, regardless of the market development of the underlying asset. These certificates are particularly attractive in times of economic uncertainty, as they provide a hedge against losses.

Functionality of the {0}

The {0} is structured in a way that it was issued on {1} and has a term of {2} days. The underlying value, {3} ({4}), determines the potential return of the certificate. Throughout the entire investment period, the issuer monitors the performance of the underlying asset.

Advantages of Capital Protection Certificates

Capital protection: The main advantage of these certificates is the protection of the invested capital. Even if the underlying value is below the initial value on the valuation day, the investor will receive back his original investment.

Potential returns: Should the underlying value, {0}, increase on the valuation day, the investor additionally profits from the price increase. The exact amount of the return depends on the structure of the certificate.

Flexibility: Capital Protection Certificates often come with different maturities and structures, allowing investors to choose a product that meets their individual needs.

Risks and Considerations

Despite the security offered by Capital Protection Certificates, there are some risks and considerations that investors should be aware of:

Limited return: Compared to direct investments in the underlying asset, the return may be limited. This is because the capital protection compensates for a part of the potential profits.

Issuer risk: The capital protection is only as reliable as the creditworthiness of the issuer. Should the issuer become insolvent, the capital protection could become ineffective.

Market conditions: The return of a Capital Protection Certificate depends on market conditions and the performance of the underlying asset. Negative market developments can reduce the potential return.

Bloomberg US Treasury 6 Month Target Duration Index

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