Thursday, 7 July 2022 Reading time : 2 minutes

Outlook remains uncertain
The major benchmark indices are still trading below their levels at the beginning of the year. After a bumpy first quarter, the equity markets failed to convince in the second quarter as well; year-to-date, the SMI fell by 16%, the Euro Stoxx 50 by almost 20% and the S&P 500 by as much as almost 21%.

Generating conservative returns with reverse convertibles
Despite all the adversities on the stock markets, various stocks have a positive analyst consensus, so these stocks are expected to outperform the reference market. Particularly in the case of stocks that have experienced major price declines YTD, the comparatively low prices can represent an interesting entry opportunity. At the same time, the increased volatility of these stocks allows for attractive coupons.

Investors who assume that share prices will rise slightly or move sideways can generate a return in the form of a coupon with reverse convertibles. If the price of the underlying is above the strike at the end of the product's term, the full capital invested is repaid in addition to the coupons. If the price of the underlying is below the strike - which is 90% for all of the following products - the underlying is delivered in addition to the coupon.

All of the following Reverse Convertibles have the following features:

• Maturity 12 months
• Strike 90%
• Subscription deadline July 11, 2022

All reverse convertibles in subscription can be found here

Swiss equities in CHF

Lonza - 6% coupon p.a.
YTD performance -28%, rating Equity Research: "overweight"

Holcim - 6.7% coupon p.a.
YTD performance -15%, rating Equity Research: "overweight

Logitech - 8.3% coupon p.a.
YTD performance -35%, rating Equity Research: "overweight"

Richemont - 8.4% coupon p.a.
YTD performance -28%, rating Equity Research: "overweight"

Kardex - 8.4% coupon p.a.
YTD performance -46%, rating Equity Research: "overweight"

European stocks in EUR

SAP - 6% coupon p.a.
YTD performance -29%, rating Equity Research: "overweight"

LVMH - 6.5% coupon p.a.
YTD performance -18%, rating Equity Research: "overweight"

Siemens - 8.6% coupon p.a.
YTD performance -37%, rating Equity Research: "market weight".

Volkswagen - 10% Coupon p.a.
YTD performance -32%, rating Equity Research: "overweight".

Infineon - 10% coupon p.a.
YTD performance -46%, rating Equity Research: "overweight".

ASML - 10% coupon p.a.
YTD performance -40%, no rating by Equity Research (analyst consensus: "buy")

American stocks in USD

Alphabet - 9% coupon p.a.
YTD performance -22%, no rating by Equity Research (analyst consensus: "Buy")

Bank of America - 9% coupon p.a.
YTD performance -31%, no rating by Equity Research (analyst consensus: "Buy")

General Motors - 12.5% coupon p.a.
YTD performance -46%, no rating by Equity Research (analyst consensus: "Buy")

NVIDIA - 15% coupon p.a.
YTD performance -49%, no rating by Equity Research (analyst consensus: "Buy")



All data indicative, values as of June 6, 2022, 5:30 p.m.

 

Disclaimer
This communication is for marketing purposes. It is neither an offer nor an invitation to submit an offer, to purchase or to subscribe to securities and does not constitute investment advice. You should consult your advisors before making an investment decision.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, financial condition, development or performance of the issuer to be materially different from any future results, financial condition, development or performance expressed or implied by such statements.
The present document has not been drawn up by the research department as defined in the rules of the “Directives on the Independence of Financial Research” published by the Swiss Bankers Association, hence these rules do not apply to this document.
If securities are mentioned in the communication, the base prospectus, the final terms and any key information document may be obtained free of charge from Zürcher Kantonalbank, Bahnhofstrasse 9, 8001 Zurich, VRIS, and from www.zkb.ch/finanzinformationen.