Phoenix Certificate
Already thought lost, but possibly soon in new splendour:
The new Phoenix convertible bond certificate in cooperation with Acatis and Genève Invest
The asset management companies Acatis and Genève Invest are pleased with the investment opportunity currently offered by the convertible bond market. The turnaround in times of increased interest rates and fallen share prices offers an ideal prerequisite for convertible bonds. On the one hand, this type of security offers the security of a bond, through a fixed redemption date at nominal value and an interest coupon. On the other hand, a recovery of the stock markets can lead to a disproportionate increase in the price of the convertible bond, through which one profits thanks to the conversion option into shares.
Disclaimer: This product is aimed exclusively at professional and institutional investors. Private clients are not eligible for this product. This document is promotional material and does not constitute advice or an investment recommendation. Past performance is not a reliable indicator of current and future performance and losses are possible. The occurrence of forecasts cannot be guaranteed.
Seizing opportunities in times of war and inflation
Together with our business partner Acatis, we launched a convertible bond product (“Phoenix”) in December, which was issued as a certificate at UBS.
The background was the massive distortions on the convertible bond market. Sharp price losses of the underlying shares reduced the probability of conversion.
What remains is an interest component that in many cases exceeds 10% p.a.
Why are convertible bonds attractive now?
An economic slowdown deep into 2023 is already priced into the current prices of convertible bonds. The asymmetric performance makes convertible bonds particularly interesting in an uncertain market environment. Long-term return expectations for convertible bonds have risen significantly for three reasons:
- Yields on the bond component are the highest they have been in over ten years.
- The valuation on the stock market has fallen below the average of the last ten years.
- Convertible bonds are historically cheaply valued - especially in Europe and Asia.
The Phoenix convertible bond certificate is therefore an attractive investment opportunity and is suitable both as an addition to a portfolio and as a stand-alone investment solution.
