35 percent protection: VW with a 17 percent chance

After the weak start to 2022, the VW Vz.

35 percent protection: VW with a 17 percent chance

After the weak start to 2022, the VW Vz. share is currently on an upward trend. With bonus certificates with a cap, investors can also achieve high returns when the share ends its upward trend.

In the past few weeks, the VW Vz. share has risen significantly from its low for the year on July 5, 2022 at 120.56 euros. The forthcoming IPO of the VW sports car subsidiary Dr. Ing. h.c.F. Porsche AG (Porsche AG), which is rated as positive by experts, and the favorable valuation of the share were largely responsible for the strong price recovery of the VW Vz. share.

In addition, the experts at UBS confirmed their buy recommendation for the VW Vz. share with a target price of EUR 230 due to the high order backlog and the increasing supply of semiconductors

The investment idea

Investors who are now considering an investment in VW Vz. shares and at the same time would like to reduce the price risk of a direct share investment could consider buying a bonus certificate with a cap as an alternative to a direct share investment. With such products, investors can achieve returns in the double-digit percentage range over the next twelve months with a significantly reduced risk of loss.

Compared to direct share purchases, bonus certificates with a cap offer investors the advantage that they enable high returns even when share prices are stagnating or falling. As a counter-trade for the attractive sideways opportunities, certificate investors have to forego the unlimited profit potential of equity investments and prospective dividend payments.

The way it works

If the VW Vz. share never touches or falls below the barrier of 95 euros by the valuation date of the certificate, then the bonus certificate with cap will be repaid on September 22, 2023 with the bonus level of 170 euros.

The key data

With the DZ Bank bonus certificate with a cap (ISIN: DE000DW5GH45) on the value, the bonus level and cap are at 170 euros. The cap defines the maximum payout amount of the certificate. The barrier activated until the valuation date, September 15, 2023, is EUR 95. At the VW Vz. share price of 146.46 euros, investors could buy the certificate for 145.92 euros.

The chance

Since investors can currently purchase the certificate for EUR 145.92, it enables a gross return of 16.50 percent in twelve months if the share price never falls by 34.90 percent to EUR 95 or below by the valuation date.

The Risks

If the VW Vz. share touches the barrier of EUR 95 by the valuation date and the share is quoted below the cap on the valuation date, the certificate is redeemed at the closing price of the VW Vz. share determined on the valuation date. If this is found below EUR 145.92, then the certificate investment will cause a loss.

This article does not constitute a recommendation to buy or sell VW Vz. shares or investment products based on VW Vz. shares. No liability is assumed for the correctness of the data.

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