Inora Life has launched a capital-protected, equity-linked three-year bond. The performance of t...
Inora Life has launched a capital-protected, equity-linked three-year bond.
The performance of the Dynamic Income Fund II, domiciled in Dublin, is derived from the performance of 25 global stocks selected from the Dow Jones Global Titans share index. Stocks include BP Amoco, HSBC, Roche and Microsoft.
On the 13 December 2001 start date, the value of each stock is recorded. The stocks are left to grow for two years. In year three from 14 December 2003 to 13 December 2004, the value of the 25 stocks is measured daily.
The top performing 15 are removed and the performance of the remaining 10 stocks is noted. If this daily average performance does not fall to -30% or lower as recorded since the start date on 13 December 2001, investors will receive 100% of their capital in addition to the 10.75% annual income or 33.75% growth.
However, during year three if at the close of any day the average performance of the 10 stocks is -30% or lower compared with the value of these stocks on day one, a 'tracker' effect is triggered. The amount of capital investors receive in the third year reflects the performance of the basket of the ten shares identified daily.
For example, if the value of the basket subsequently grows to 120%, investors receive 120%, plus 10.75% annual income or 33.75% growth. However, if it falls to 65%, investors receive 65%, plus the 10.75% annual income or 33.75% growth, which is guaranteed.
The Dynamic Income Fund II also includes a 'Limited Income Option' which allows investors to take 5% income each year on a fully tax-deferred basis, leaving a further 18% to be returned in addition to the capital.
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