What is Bull ELN?
It is a type of ELNs with an investment period of 2 weeks - 3 months, which allows you to earn a higher return than general notes investment. However, your return will be based on the underlying asset, investment horizon, and strike level.
Structured Debenture Note or Bull ELN is designed for investors who want to invest in stocks at the desired price or want to generate high short-term returns especially when the market is in a sideway-up trend.
Why Bull ELN?
- Higher annual return than other fixed-income securities with your chosen risk-level.
- Create an opportunity to buy stocks at prices lower than the current market price.
- Suitable for the market with unclear direction or sideway-up.
Who is suitable for Bull ELN?
- Investors who want to accumulate stocks a few at a time.
- Investors with risk tolerance who want to generate high return.
Maximum profit and loss for Bull ELN
- Highest Profits = Yield depending on your chosen risk-level
- Highest Losses = Not higher than Protection level at 80%
Calculation Examples
After the investor has opened an ELN account, the first thing investor needs to know before start investing in ELNs must be the prices and yields of our products. Investors can follow up on the indicative price sheet of Bull ELN and seeking additional advice from the investment advisor.
Pricing Sheet
| Pricing Sheet : Bull ELN | |||
|---|---|---|---|
| Trade Date | 10 August 2020 | Protected Level (%) | 80% |
| Issue Date | 13 August 2020 | Notional Amount | 30,000,000 บาท |
| Valuation Date | 9 September 2020 | Settlement Method | Physical / Cash Delivery |
| Maturity Date | 11 September 2020 | No. of holding days | 30 Days |
| Underlying | Spot Price (THB) | Strike Level (%) | Strike Price (THB) | Protection Price (THB) | Annualized Yield (Before Tax) | Issue Price (% of Par) | Number of shares for delivery |
|---|---|---|---|---|---|---|---|
| AAA | 10.00 | 99% | 9.90 | 7.92 | 24.7033% | 98.01% | 3,030,303.0303 |
| 97% | 9.70 | 7.76 | 19.5319% | 98.42% | 3,092,783.5051 | ||
| 95% | 9.50 | 7.60 | 11.2973% | 99.08% | 3,157,894.7368 |
Remark:
Spot Price is the AAA share close price in the day before (9 August 2020). The example price sheet will only be use for calculation reference. It is not the actual price that investor will get. Strike level, Annualized yield, and Issue price are the only factors that investor will get from the pricing sheet. (These factors do not depend on the spot price.)
When you start investing in ELN, we will call this date “Trade Date”
| 1. Trade Date (10 August 2020) | |
|---|---|
| Assume you choose AAA stock at 97% Strike level, Notional amount of 30 million Baht, and Spot price of 10 Baht. | |
| Strike Price | 9.70 Bath (97% of Spot Price) |
| Protection Price | 7.76 Bath (80% of Strike Price) |
| Notional Amount | 30,000,000 Baht |
| No. of Shares that will be delivered | 3,092,783.5051 Shares (30,000,000 / 9.70) |
| Annualized Yield (Before tax) | 19.5319% |
| Return (Before tax) | 474,000 Baht [30,000,000 (1-98.42%)] |
| Issue Price | 29,526,000 Baht (30,000,000 x 98.42%) |
| No. of holding days | 30 Days |
| 2. Issue Date (13 August 2020) is Trade Date 2 Working Days | |
|---|---|
| Money will be transfer to CIMBS account for buying Bull ELN | |
| Selling Price (Before Tax) | 29,526,000 Baht |
| 15% Withholding Tax | 71,100 Baht [(30,000,000 - 29,526,000) x 15%] |
| Selling Price (After Tax) | 29,597,100 Baht |
| 3. Valuation Date (9 September 2020) is Maturity Date 2 Working Days | |
|---|---|
|
There are 3 possible cases for your return |
|
|
Case 1 ( AAA > 9.7) Spot Price > Strike Price |
Investor receive 30,000,000 Baht in cash |
|
Case 2 ( 7.76 > AAA < 9.7) Protected Price > Spot Price < Strike Price |
Investors receive 3,092,700 Shares and 810 Baht in cash (Odd lot 83.505154 x 9.70) |
|
Case 3 ( AAA < 7.76) Spot Price < Protected Price (such as AAA = 7 baht) |
Investor receive 3,092,700 AAA Shares and 810 Baht in cash (Odd lot 83.505154 x 9.70) and
2,350,515.4639 Baht in cash from protection |
| 4. Maturity Date (11 September 2020) | |
|---|---|
| Investor receive return according to the case in Valuation Date | |
Overall Return
Disclaimer:
The Structured Note is offered to High-Net-Worth investors (HNW), Ultra High-Net-Worth (UHNW) and institutional investors (II). It is a high-risk and complex product. The value of the Structured Note depends on uncertain factors. Investors may lose the principal in whole or part or receive lower-than-expected returns. Structured Notes do not have a secondary market for trading and have transfer restrictions as specified by the terms and conditions. Please understand the product's characteristics, the conditions of return, and the risks involved, and seek additional advice before making an investment decision.