Examplary Underlying: Commodity
In general, Commodity Outperformance Certificates allow you to participate in the performance of the underlying at a leveraged rate. This is normally financed by a cap level, which leads to a maximum participation in the leveraged performance, however the product can also exclude the cap level under favorable market conditions.
USD, Cash Settled
limited by the cap level, Maximum Return 145%
at risk below strike 100%
Return on investment (ROI) on the redemption date
Assumptions: Underlying Brent Crude Oil, Reference price USD 64.38, strike level 100.00%, cap level 130%, upside performance participation 150%, Maximum return 145%
|Underlying on the expiration date||ROI|
If the underlying closes at or above the cap level on the expiration date, you will receive the maximum return
If the underlying closes above the strike level on the expiration date, you will benefit from a leveraged and unlimited participation in the upside performance of the underlying.
If the underlying closes at or below the strike level on the expiration date, you will be fully exposed to any negative performance of the underlying (unleveraged downside). In a worst case scenario this position becomes worthless and you would lose all of the invested capital.