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    Structured Product

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    abhipawar376
    This document describes a structured product called a Nifty Accelerator, which provides exposure to the Nifty 50 index. It offers both principal protection and equity-linked returns depending on the performance of the underlying index. The product offers capital protection if the index falls up to a certain level, and participates in upside returns through predefined participation rates. However, it also carries risks like liquidity risk and contingent return risk.

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    Structured Product

    Uploaded by

    abhipawar376
    43 views14 pages
    This document describes a structured product called a Nifty Accelerator, which provides exposure to the Nifty 50 index. It offers both principal protection and equity-linked returns depending on the performance of the underlying index. The product offers capital protection if the index falls up to a certain level, and participates in upside returns through predefined participation rates. However, it also carries risks like liquidity risk and contingent return risk.

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    This document describes a structured product called a Nifty Accelerator, which provides exposure to the Nifty 50 index. It offers both principal protection and equity-linked returns depending on the performance of the underlying index. The product offers capital protection if the index falls up to a certain level, and participates in upside returns through predefined participation rates. However, it also carries risks like liquidity risk and contingent return risk.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    43 views14 pages

    Structured Product

    Uploaded by

    abhipawar376
    This document describes a structured product called a Nifty Accelerator, which provides exposure to the Nifty 50 index. It offers both principal protection and equity-linked returns depending on the performance of the underlying index. The product offers capital protection if the index falls up to a certain level, and participates in upside returns through predefined participation rates. However, it also carries risks like liquidity risk and contingent return risk.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 14

    Structured Products/MLDs are hybrid instruments issued in the form of a bond, where the retu

    performance of the underlying market benchmark.

    Types of MLDs: Principal Protected and Non-Principal Protected


    Advantages / Features:
     Capital Protection/Downside Protection – Most Equity MLDs provide feature of receiving
    amount even if the market performs poorly.

     Low Volatility/Standard Deviation – The volatility (SD) of MLD’s are usually half or ev
    even better than that of debt mfs.

     Equity Like Return – The returns of MLD’s are usually at par with long term average index retu

     Predefined Pay Offs – The payoffs are usually defined subject to levels of nifty which reduced t

     Plan B to your Portfolio/Diversifier – Having an MLD would act as yield enhancer whe
    the same time, it would make our portfolio more diversified.

     Mechanical Strategy less human intervention : The strategy is well defined, and all pay offs and
    intervention.

    Risk: Liquidity risk (MLD’s not frequently traded on exchange), Contingent return risk (makes retu
    Bonds), and Risk of early termination(return will not be as per expectation).

    Avg. Risk & Return of Equity Mutual Funds


    Particulars

    Return Benchmark*

    Portfolio Avg. Ret.

    Riskiness of Portfolio (Std. Deviation)

    Probability of Loss

    Avg. Risk & Return of Structured Products (Nifty Accelerator)


    Particulars

    Return Benchmark*

    Portfolio Avg. Ret.


    Riskiness of Portfolio(^Std. Deviation)

    Probability of Loss
    eived is dependent on the

    principal/portion of your principal

    of Nifty which makes it at par or

    bability of giving return

    give you the return we expect. At

    e model which allows less human

    etermine before hand unlike

    Value

    12.53%

    14.53%

    9.07%

    4.2%

    Value

    12.53%

    14.24%
    4.27%

    0.47%
    Nifty Accelerator – 100% Product Specifications
    Product Name Nifty Accelerator– 100%
    Issuer Anand Rathi Global Finance Limited
    Underlying Nifty 50 Index
    Principal Protected Principal is not protected
    Tenor(days) 1900 Days
    Initial Fixing Level 150 points contingent from closing nifty then rounded to next 100
    Final Fixing Level Average of Closing NIFTY on last Thursday of 44 th, 47th, 50th, 5

    Nifty Performance (NP) (Final Fixing Level/Initial Fixing Level)-1

    Contingent Coupon (CC) 100% (IRR – ~14.24%)

    Participation Rate1 (PR1) 100%(From 110% to 133% of Initial Fixing Level)

    Participation Rate2 (PR2) 7800%(From 132% to 133% of Initial Fixing Level)

    Decay Multiple (DM1)® Knock-In 1.4x (below -10% till -30% fall with catch-up)
    Put @ 84.99%

    Decay Multiple (DM2)® Nifty @ 0.4x (Between -30% till -90% fall decay decreases)
    69.99% of initial

    If Final Fixing Level is at or


    above 133% of Initial Fixing
    Level
    If Final Fixing Level is above
    110% & below 133% of Initial
    Fixing Level

    If Final Fixing Level is at or


    Payoff above 90% & at or below 110% of
    Initial Fixing Level

    If Final Fixing Level is below


    90% of Initial Fixing Level
    If Final Fixing Level is below
    10% of initial Fixing Level
    t Specifications
    %
    ance Limited

    om closing nifty then rounded to next 100


    FTY on last Thursday of 44 th, 47th, 50th, 53rd & 56th Month.

    al Fixing Level)-1

    3% of Initial Fixing Level)

    33% of Initial Fixing Level)

    0% fall with catch-up)

    -90% fall decay decreases)

    Contingent Coupon

    (NP-10%)* PR1+ Max(0%,(NP-32%)*PR2

    Principal Protection

    MAX(-100%,MAX((- 30%*DM1),NP*DM1)+MIN(0%,(NP+30%)*DM2))
    NP
    Nifty Accelerator – 100% Product Payoff

    Nifty Values Nifty Perf. Product Return Nifty IRR Product IRR
    43800 100.0% 100.0% 14.2% 14.2%
    32850 50.0% 100.0% 8.1% 14.2%
    29127 33.0% 100.0% 5.6% 14.2%
    28908 32.0% 22.0% 5.5% 3.9%
    28689 31.0% 21.0% 5.3% 3.7%
    24309 11.0% 1.0% 2.0% 0.2%
    24090 10.0% 0.0% 1.8% 0.0%
    23652 8.0% 0.0% 1.5% 0.0%
    21900 0.0% 0.0% 0.0% 0.0%
    21600 -1.4% 0.0% -0.3% 0.0%
    20805 -5.0% 0.0% -1.0% 0.0%
    19710 -10.0% 0.0% -2.0% 0.0%
    19708 -10.01% -14.01% -2.01% -2.86%
    17520 -20.0% -28.0% -4.2% -6.1%
    15330 -30.0% -42.00% -6.6% -9.9%
    12045 -45.0% -48.00% -10.8% -11.8%
    2190 -90.0% -66.00% -35.7% -18.7%
    2188 -90.01% -90.01% -35.8% -35.8%
    0 -100.0% -100.0% -100.0% -100.0%

    Product IRR* 14.24%

    Tenor – 1900 Days


    Expiry – Avg. of
    44th, 47th, 50th, **Standard Deviation
    Target Nifty Perf
    53rd & 56th Months 4.46%

    Product Explanation
    NP >= 33% 100% (Contingent Coupon)
    32% < NP < 33% Max(0%,(NP-30%)*PR2
    10% < NP < 33% (NP-10%)* PR1
    -10% <= NP <= 10% Principal Protection
    -30% <= NP < -10% 1.4x Decay with Catch-up
    -90% <= NP < -30% Decay decreases to 0.4x
    Nifty Falls Beyond -90% Nifty performance
    Product IRR
    14.2%
    14.2%
    14.2%
    3.9%
    3.7%
    0.2%
    0.0%
    0.0%
    0.0%
    0.0%
    0.0%
    0.0%
    -2.86%
    -6.1%
    -9.9%
    -11.8%
    -18.7%
    -35.8%
    -100.0%

    Target Nifty Perf. 33%


    Historical 1710 Day Rolling Return (Nifty Working days only)
    5Yr Nifty Accelerator - 100%
    500.0%

    Probability Normal
    Total Observations 4559

    % of times Product has given Maximum


    3883
    Returns (100%)

    % of times Product has given zero or


    4504
    positive returns

    Standard Deviation*

    The information provided is this communication is reproduction of factual details. No part of information provided herein shoul
    must make their own investment decisions based on their own specific investment objectives and financial position. This comm
    financial instrument/security.
    Data Source: Anand Rathi Structured Product Presentations
    king days only)

    85.17%

    98.79%

    4.46%

    . No part of information provided herein should be construed as investment advice by ARSSBL and/or its employee. Investor/Client
    t objectives and financial position. This communication does not constitute an offer or solicitation for the purchase or sale of any
    vestor/Client
    ale of any

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