Participation certificate (tracker certificate)

A certificate that securitizes the right to participate in the performance of an underlying asset. – The issuer – the bank – selects a suitable underlying asset for this purpose, sets a price level of this underlying asset as the starting value (strike price) and, if expedient – for example: extremely high price of the asset in question – divides the underlying asset into smaller units by a freely selected ratio. A participation certificate usually runs indefinitely (open-end); however, there are also securities with an agreed date of maturity. – Such a certificate is suitable for investors who – expect an increase in value of the underlying instrument, – have a certain risk tolerance, as the certificate also participates in price losses, and – have a long-term investment horizon. – See theme certificate.

Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!
University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/