48 percent protection: Infineon with a 12 percent chance

The Infineon share has been able to stabilize in the past few days after several weeks of falling prices.

48 percent protection: Infineon with a 12 percent chance

The Infineon share has been able to stabilize in the past few days after several weeks of falling prices. With a bonus certificate with a cap, investors can still achieve a return in the double-digit percentage range even if the share loses a further 48 percent of its value.

Infineon shares lost more than a quarter of their value last month. While the share of one of the world's leading providers of semiconductor solutions was still above EUR 29 on June 1, 2022, it was temporarily trading at EUR 20.70 on July 5, 2022, a new 12-month low. After that, the share was able to recover slightly.

A number of analysts assume that semiconductor companies could outperform the overall market even in the event of a recession. In the most recent analysis, the experts from Bernstein Research confirmed their buy recommendation for the Infineon share with a target price of EUR 39.

The investment idea

After the price slide of the past few weeks, now could be a good time to invest in the Infineon share, which is classified as severely undervalued. However, if you want to significantly reduce the risk of buying shares directly and still want to achieve returns above the inflation rate, you could consider investing in a bonus certificate with a cap.

Apart from dividend payments, private investors can only achieve positive returns when buying a share directly if the price rises. Compared to direct share purchases, bonus certificates with and without a cap offer investors opportunities for annual returns in the double-digit percentage range not only when the share price rises, but also when the price stagnates or falls.

The way it works

If the Infineon share never touches or falls below the barrier of EUR 12.00 by the valuation date of the certificate, then the bonus certificate will be repaid on June 23, 2023 with the bonus level of EUR 26.00.

The key data

The HSBC bonus certificate with a cap (ISIN: DE000HG420N9) on the Infineon share has a bonus level and a cap of EUR 26.00. The cap defines the maximum repayment amount of the certificate. The barrier activated by the valuation date, June 16, 2023, is EUR 12.00. With the Infineon share price of EUR 22.91, investors could buy the certificate for EUR 23.14.

The chance

Since the certificate is currently available for EUR 23.14, it enables a gross return of 12.35 percent (=13 percent per year) in eleven months if the share price has never fallen by 47.62 percent to EUR 12.00 by the valuation date or falls below.

The Risks

If the Infineon share touches the barrier of EUR 12.00 by the valuation date and the share is listed below the cap on the valuation date, the certificate is redeemed at the closing price of the share determined on the valuation date. If this price is fixed below EUR 23.14, then the certificate investment will cause a loss.

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

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