Attractive interest rate offers: Allianz reverse convertible bond at 12% p.a. - is it worth the investment?

Attractive interest rate offers: Allianz reverse convertible bond at 12% p.a. - is it worth the investment?

According to a report by www.deraktionaer.de, investors are increasingly looking for attractive interest rate offers due to geopolitical risks and weaker economic indicators. A reverse convertible bond issued by HSBC with the WKN HS2S0M offers a whopping 12 percent p.a. with a term until October 25, 2024. The interest payment is guaranteed and independent of the price development of the share.

This is how repayment works

The bond will be repaid at 100 percent (nominal value) if the Allianz share is at or above the strike price of 224.49 euros on the valuation date of October 18, 2024. Otherwise, repayment will be made through the delivery of shares in line with the subscription ratio.

This is where the loss zone begins

With a current Allianz price of 218.90 euros, investors will be in the red with their investment if the price falls below 198.05 euros.

It is clear that equity bonds offer attractive returns, but also carry the risk of losses. It is important to understand the risks and conditions carefully before deciding on such a financial product. In times of low interest rates, equity bonds can be an interesting alternative, but investors should be careful and consider their individual situation in order to make an informed investment decision.