5 reasons to invest in the Bull & Bear Certificates on Finnish stocks
Bull & Bear Certificates are popular products for active investors. Trading with Bull & Bear Certificates is convenient because they are listed securities based on the development of the underlying. Good news for a Finnish investor is that Vontobel offers a wider range of Bull & Bear certificates on Finnish shares.
Many Finnish investors want to focus on domestic equities. There are several reasons.
First of all, there is a lot of stock in the world and, by focusing on domestic shares, the investor can simply get it easier. Secondly, domestic companies are familiar to many. The machine is a familiar company that is easy to identify with. Schindler may not be so. Third, Finnish companies get information in Finnish. Under the homepage of listed companies there is an investor-oriented section and domestic media deals more frequently with domestic shares. Even if English could be a language for many Finnish, it is faster, and perhaps more definitely and things are clear, because misunderstandings become less when it is available in Finnish. Fourthly, there are several international quality companies on the Helsinki Stock Exchange, whose business is mainly located abroad. Foreign business reduces land risk.
For some, investing in domestic equities is a value in itself. Here are 5 reasons why invest in domestic shares with Bull & Bear Certificates is reasonable.
Vontobel Finland is currently offering Bull & Bear Certificates for more than ten domestic shares.
These shares are the sports equipment manufacturer Amer Sports, telecommunications, ICT and online service company.Elisa,Kone, which manufactures elevators and escalators and provides them with services, and equipment and services. Mining, Rock Crushing, Recycling and Process Industries Metso. In addition, Renewable Diesel Producer and Oil Processor Neste, a technology company from Nokia, a stainless steel company, Outokumpu, and Nokian tires, the world's northernmost tire manufacturer, are also on the list. Banking and insurance business is represented by the financial groups Nordea and Sampo. Representatives of the forest industry are UPM and Stora Enso.
So there are alternatives.
Bull & Bear Certificates are leveraged products. Certificates have coefficients that tell you how much leverage is. The good side of the leverage effect is that the investor has the opportunity to achieve the same return with a smaller amount of capital invested. Thus, an investor can capitalize on market trends with a smaller amount of capital. However, it is good to remember that the amount of risk invested by the investor increases with the lever.
The Bull Certificate will rise as the underlying share rises and falls when the underlying stock falls. The Bear Certificate works the other way round. The Bear Certificate will rise when the underlying share falls and falls when the underlying share is raised. The investor can thus take the positive and negative view with the help of the Certificates.
Dividends are taken into account in the value of the Certificate so that the Bull Certificate is cheaper than the expected dividends and the Bear Certificate, while the expected dividends are more expensive than the underlying stock. Therefore, a single share Certificate takes into account the dividend effects in advance.
The higher the leverage the higher the yield. On the other hand, the risk increases as the leverage increases. When there are several alternative leverage options available, the investor can choose the appropriate risk level for himself.
For example, Nokia is available with both 3x and 5x lever.
An investor should consider a few things before making an investment decision. First, volatility of underlying stock reduces returns of Bull & Bear Certificates.
The value of Certificates is based on day-to-day valuation changes and intense exchange rates can lead to a situation where the leveraged Certificate yields less than expected. The table below illustrates the matter.
Secondly, Bull & Bear Certificates are complex investment products whose operations need to be understood before investing in them.
Thirdly, Bull & Bear Certificates have a high risk of losing capital in whole or in part. The nature and amount of this risk must be understood before making an investment decision.
All Bull & Bear Certificates