Friday, 15 July 2022 Reading time : 3 minutes

Dividend yield as a decisive factor
One of the most frequently observed key figures in investment decisions - in addition to fundamental data - is the (expected) dividend yield. It expresses how much dividend an individual share pays in relation to its price and is therefore a good way of comparing different shares. Investors naturally try to achieve the highest possible returns, which is why stocks with high dividends combined with an attractive share price and sound fundamentals are often convincing, especially in longer-term strategies.

Reverse convertibles to optimize returns
Certain stocks, often popularly called "dividend gems," typically have higher dividend yields than the market average. For investors looking to build exposure to these stocks, the use of reverse convertibles on these stocks may be appropriate. 

If the final fixing is below the strike, the investor is delivered a predetermined number of shares in addition to the guaranteed coupon. This results in a more favorable cost price compared to the value at initial fixing. If the share closes above the strike at expiration, the investor receives back the full capital invested in addition to the coupon.

All subsequent reverse convertibles have a strike of 90% and are structured in such a way that the redemption is executed at least three days before the respective ex date. The subscription deadline is July 15, 2022, 4:00 p.m.

Zurich - 4.00% coupon (5.81% p.a.)
Indicative dividend yield: 5.38%.
Redemption: March 30, 2023
Ex-Date: April 6, 2023
ZKB Equity Research: "Overweight

Swiss Life - 4.75% Coupon (6.53% p.a.)
Indicative dividend yield: 5.33%.
Redemption: April 14, 2023
Ex-Date: April 20, 2023
ZKB Equity Research: "Overweight

Swiss Re  - 4.75% coupon (6.60% p.a.)
Indicative dividend yield: 8.23%.
Redemption: April 11, 2023
Ex-Date: April 14, 2023
ZKB Equity Research: "Market Weight".

Julius Bär - 6.75% Coupon (9.35% p.a.)
Indicative dividend yield: 6.09%.
Redemption: April 12, 2023
Ex-Date: April 17, 2023
ZKB Equity Research: "Market Weights

Sulzer - 6.5% Coupon (9.25% p.a.)
Indicative dividend yield: 5.99%.
Redemption: April 5, 2023
Ex-Date: April 11, 2023
ZKB Equity Research: "Overweight

Holcim - 5.6% coupon (7.20% p.a.)
Indicative dividend yield: 5.44%.
Redemption: May 2, 2023
Ex-Date: May 5, 2023
ZKB Equity Research: "Overweight

AXA - 6% Coupon (7.83% p.a., EUR)
Indicative dividend yield: 7.41%.
Redemption: April 28, 2023
Ex-Date: May 5, 2023

Mercedes-Benz  - 9% Coupon (11.57% p.a., EUR)
Indicative dividend yield: 9.83%.
Redemption: May 2, 2023
Ex-Date: May 8, 2023

BASF - 8.8% Coupon (11.78% p.a., EUR)
Indicative Dividend Yield: 8.4%
Redemption: April 21, 2023
Ex-Date: April 28, 2023

ENEL - 6% Coupon (12.27% p.a., EUR)
Indicative dividend yield: 7.79%.
Redemption: January 18, 2023
Ex-Date: January 23, 2023

 

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.