Expected
yield per annum
27-31%
  • Minimal Investment amount 2700 USD
  • Expiration date: 24.01.2019
  • Capital Protection: 80%

Guess? is a company engaged in manufacturing and sale of casual wear, in addition, the company produces various brand accessories, watches, as well as jewelry. The capitalization is $1.23 billion, and the number of employees is 14 thousand people.*

Underlying Assets Guess
Currency USD
Expected yield, % per annum 27-31%
Volume of investments 2700 USD
Term of placement of the deposit up to 24.01.2019
Protection of capital 80%
Participation Rate 0.6
Direction of Underlying Asset Price Movement on a price decrease

Falling factors:

  • The crisis aftermath. Almost 10 years have passed since the global financial crisis, but the company stock price not only did not return to the pre-crisis level, but continues to fall throughout the period, relative to the historical maximum, the stock price is lower by more than three times.
  • Negative financial indicators. Over the past year, the capitalization has gone down by almost half, at the end of 2016, it was $2.3 billion, and at the time of calculation, it is only $1.23 billion.
  • Competitors. Despite the fact that Guess? was one of the first major clothing manufacturers to launch their own online store in 1999, it has not managed to compete with the largest e-commerce clothing stores.
  • Scandals. At the beginning of the year, the former Guess? company face, actress and model Kate Upton accused the creator and chairman of the board of directors Paul Marciano of sexual misconduct. That story caused almost a 25 percent drop in stock price, and the echoes of this situation will continue to negatively affect the company, while Marciano remains head of the company.

 

Analysis:

The stock price is in the middle of the third impulse downward wave, and its nearest possible ending is at the level of $12.7 per share, which is the continuation of the share price decline by 34.2% of the current rate.

 

This product allows you to participate in the decrease of the underlying asset price wherein the investor risks with a limited amount, which is determined by the Capital protection level.

The product is dedicated specifically for conservative investors, where they can  define and limit the risks of such products themselves. As such, these products provide a great opportunity to receive relativelly high income whilst minimising the possibility of capital loss.

*according to the information from the company's website.

  • Product with capital protection
  • Minimal Investment amount 2700 USD

How the product works

Once the contract is concluded, the initial price of the underlying asset, the Capital protection level, and the participation rate are recorded.

Investor risks are limited to the amount determinated by the Capital protection level.
A product with 100% protection level carries the lowest possible risk and the lowest potential yield.

The repayment to the client is calculated according to the following formula:
Repayment = Investment amount * Capital protection level + Participation rate * Price change- Commission.
Where the investment amount is taken as 100%, and the price change is calculated as follows (Current Price – Initial Price) / Initial Price * 100%.

The commission for a investment product creation is 2% of the initial investment and is charged at the time of product expiration.

If at the Expiration date the price of the underlying asset is higher than the initial price, the investor is paid 100% of the invested funds and an income equal to the product of the participation rate and the growth of the underlying asset. Conversely, the investor is paid the invested funds in accordance with the Capital protection level.

The parameters of the products are indicative and may vary depending on the market situation.

 

Examples:

1. The price of the underlying security moves in the direction chosen by the investor.

In this case, the investor receives the invested amount calculated by the formula: 100% (initial investment) * 80% (Capital protection level) + 0.6 (participation rate) * 60% (price change) = 116%

2. The underlying security’s price moves in the opposite direction and finished below the Capital protection level.

In this case, the investor receives the invested amount calculated by the formula: 100% (initial investment) * 80% (Capital protection level) = 80%

Attention!

The product yields shown in the examples and past financial performance do not guarantee future profits. All investment products are denominated in USD. The commission for an investment product creation is 2% of the initial investment and is charged at the time of product expiration. The expected yield of investment products is given in annualized percentage form.

Note:

The protective investment component is allocated to fixed income products (Eurobonds and deposit schemes at leading banks). NordFX cannot be held responsible for any potential risks associated with the default of Eurobond issuers or the bankruptcy or default of any of the banks in which the deposits are held.

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