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Sustainable investments with 24% return opportunity

The closing price of the STOXX Global ESG Leaders Select 50 Price Euro Index on 19.11.20 is set as the starting value for the Sustainability Bond 90% V. In eight years, on 15.11.28, the current index level will be compared with the starting value. If the index is at least 12 percent higher than the starting value on that day, the bond will be repaid at 124 percent of the starting value.

Daphne Freeman

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In addition to the return opportunities and risks of a form of investment, the topic of “sustainability” is becoming increasingly important for investors. Since it is by no means easy for private investors to find shares that correspond to this topic, an investment in a share index compiled by experts that corresponds to the sustainability topic seems sensible.

The underlying instrument for the new RCB sustainability bonds is the STOXX Global ESG Leaders Select 50 Price Euro Index (ISIN: CH0298407260). This index contains 50 shares with a low fluctuation margin and high dividend payments. The maximum weighting of a share is limited to 10 percent of the index value. Only shares of companies that meet the inclusion criteria of ecological, social, and responsible action are included in the index. The index composition is reviewed at quarterly intervals and adjusted if necessary.

If you want to read more on the subject and to find more details about the STOXX Global ESG Leaders Select 50 Price Euro Index (ISIN: CH0298407260), download our companion app for free. With the Born2Invest mobile app you can find the latest business news in the world and stay on top of the market.

-10%, 0%, 12% or 24% return opportunity

The closing price of the STOXX Global ESG Leaders Select 50 Price Euro Index on 19.11.20 is set as the starting value for the Sustainability Bond 90% V (ISIN: AT0000A2K9J2). In eight years, on 15.11.28, the current index level will be compared with the starting value. If the index is at least 12 percent higher than the starting value on that day, the bond will be repaid at 124 percent (=2.7 percent per year) of the starting value. If the index is at least 100 percent, the redemption amount will be 112 percent (1.4 percent per year) of the issue price. If the index level on that day is less than ten percent negative, the certificate will be redeemed at the issue price of 100 percent. If the index falls more than ten percent below the issue price, the certificate will be redeemed at 90 percent of the issue price. Irrespective of the actual decline in the index, the maximum risk of loss of this certificate is ten percent.

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-10% or 24% chance of return

The Sustainability Bond 90% VI (ISIN: AT0000A2K9H6) on the same index will already be repaid at 124 percent (=2.7 percent per year) if the index is listed above the starting value in eight years. If the index is below the starting value on the last valuation day (15.11.28), the certificate is repaid at 90 percent of the issue price. Both certificates can still be subscribed to until 18.11.20 in a denomination of $1,180 (€1,000) at 100 percent.

Certificate Report Conclusion: 

The two sustainability bonds 90% enable in slightly different ways in the next eight years with a maximum risk of loss of ten percent even with a slight rise in the STOXX Global ESG Leaders Select 50 Price Euro Index annual gross yield opportunities of 1.4 and 2.7 percent.

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(Featured image by Free-Photos via Pixabay)

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First published in FinanzNachrichten.de, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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Daphne Freeman has worked in the crowdfunding and impact investing industry for the past few years, gaining experience in marketing, and connecting businesses and entrepreneurs in need with the right investors. As a seasoned grant writer as well as financial market journalist, she is passionate about making a social impact in the world. A free spirit, Daphne also enjoys writing and exploring topics of interest, currently CBD, health and beauty, and social media influencers.