UBS is offering a seven-year capital protected product with Chinese exposure to international invest...
UBS is offering a seven-year capital protected product with Chinese exposure to international investors for a minimum investment of $1,000.
The structured note will gain its exposure to China theough the Baring Hong Kong China fund – the guarantee will be provided through investment in UBS's own zero coupon bonds.
The note will use Constant Proportion Portfolio Technique (CPPT) to guarantee the initial capital. In addition to this, 30% of any captured profit will be added to the guaranteed amount each year.
The US dollar-denominated product has a minimum issue size of $20m and an initial allocation of 70% in the Baring Hong Kong China fund and 30% in cash units. Assets are allocated between active assets – the underlying mutual fund – and the reserve assets – zero coupon bonds or cash funds. The minimum investment is $1,000.
Kheim Do, head of Asian equities at BAM, said: "We strongly believe we are at the beginning of a second industrial revolution in China. In fact, we think the Chinese miracle will be the dominant economic agent of change this decade.
"We are convinced that our East vs West theme will provide investors with handsome returns as Eastern markets will dramatically outperform."
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