Pricing Date : Jan 7 2011
Observation Date: Jan 20 2012
Minimum denomination: $10k
Minimum Contingent Return: 10%(range -31.80% - +10%)
Maximum Return: 25%(on Stock return over +25%)
Minimum Loss: -31.81%
Trigger Event: -31.81%
No Interest or Dividends.
Well the return on a plain vanilla tracking security, where the payoff at maturity is derived from the performance of the underlying asset is similar to the return on a forward – a simple yet deceptive derivative. A forward contract in layman terms is a customizable agreement between two parties to sell or buy an asset at a specified future time at a price agreed today. No money changes hands until the specified time, simple right?