The main types of certificates are:
Guaranteed
Structured products offering a guarantee on the money invested on maturity. Also, they may bear a fixed or variable yield for the investor for the entire term of the investment or on maturity, in the form of coupon payments or participation in the performance of the underlying asset.
Bonus certificates
Structured products without a guarantee on the money invested, but offering partial conditional protection. They are usually linked to the performance of the underlying asset, and a barrier is usually set.
Discount certificates
Structured products without a guarantee on the money invested. They are traded and quoted with a discount on the market value of the underlying asset, in return for which the investor accepts to participate in the potential profits (capped) from the asset’s performance.
Convertible bonds
Structured products without a guarantee on the money invested. They bear a comparatively high yield in the form of coupons paid regardless of the performance of the underlying asset. If the price of the underlying asset is above a preset barrier, the investor will receive 100% of the money invested on maturity. If the barrier is reached and/or the price of the underlying asset on maturity is lower than a preset strike price, the investor will receive a predetermined number of securities in the underlying asset (number = par value/strike price).
Express certificates
Structured products without a guarantee on the money invested. Their maturity is generally longer, but if the underlying asset is traded above a certain level on preset assessment dates, the product will be bought back at a higher value. If the underlying asset is quoted under the relevant value, the product’s term will be automatically extended until the next assessment date.
Index certificates
Structured products without a guarantee on the money invested. They allow the investor to participate 1:1 in the performance of a certain index. There are also short index certificates which allow the investor to make a profit when the markets drop.