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Rebate Offer
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2.0% (73%)
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Minimum Initial Investment
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$20,000
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Expected Close Date
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CLOSED
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Offer opens 7 February 2011
HSBC 100+ Series Emerging Markets Outperformance Investment provides investors with the opportunity to receive a potential return that is linked to the performance of emerging markets equities compared with developed market equities.
There are two investment options available, investors can elect either or both of the following:
- HSBC 100+ Series Emerging Markets Outperformance (Growth) Investment
- HSBC 100+ Series Emerging Markets Outperformance (Income) Investment
Both investments offer the additional comfort of 100% capital protection at the end of the three year investment term*.
Investment Strategy
The Fund seeks to achieve its investment objective through a 'long-short portfolio' in which long exposure is taken to the HSBC Optimised Global Emerging Markets Total Return Index ("GEM Index") through notional borrowing and short exposure to a basket of leading developed markets equity index futures. Two risk control mechanisms are incorporated into this strategy and investors have the additional security of a Capital Guarantee at Maturity.
The GEM Index provides a benchmark which gives exposure to up to 50 companies from up to 10 emerging market countries or regions. As at 30 June 2010, the GEM Index currently provides exposure to stocks of the following emerging countries:
- BRIC countries, Mexico, South Korea, Taiwan, South Africa and Turkey; and
- the "New Europe" countries of Poland, the Czech Republic and Hungary.
There are two risk control mechanisms within the Strategy. One risk control mechanism involves reducing emerging markets exposure in a down trending market to mitigate the greater downside volatility that has been observed in emerging markets. The second risk control mechanism is a volatility control strategy which aims to optimise the risk/return profile of the Strategy. In addition, as the underlying HSBC Emerging Markets Outperformance Strategy is denominated in US Dollars, the Strategy is alco currency hedged in Australian Dollars to manage the effects of exchange rate fluctuations between Australian and US Dollars.
The key benefits of the Investments are:
- Access to the outperformance of emerging markets equities over developed markets equities through the Strategy;
- 100% capital protection if the Investments are held to Maturity*;
- Choice of receiving your return as annual income and/or capital growth at Maturity; and
- Issued by a member of one of the world’s largest banking and financial services organisations.
The Investments may suit investors who have a positive outlook for emerging markets equities versus developed markets equities and still require 100% capital protection at maturity.
| Fee Disclosure | | 2020 DIRECTINVEST will rebate 2.0% of the 2.73% upfront commission in the form of a cheque. 2020 DIRECTINVEST will retain 0.73% to cover postage & handling, marketing and administration of the fund. No trailing commission is paid on this Fund. |
*Capital protection does not apply where there is an Early Termination or an Early Withdrawal.
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