In a Structured Retail Product with a 150% participation rate and a 90% capital guarantee, what is the gross investment value at maturity if the underlying asset grows by 5%?

To determine the gross investment value at maturity of the Structured Retail Product, we need to understand how capital guarantees and participation rates work in this context.

The capital guarantee ensures that you will receive a minimum of 90% of your original investment back, regardless of how the underlying asset performs. This is a level of security for the investor.

The participation rate indicates how much of the growth in the underlying asset will be passed on to the investor. In this case, with a participation rate of 150%, the investor is entitled to 1.5 times the underlying asset's growth.

Let's break down the calculations:

1. Assume an initial investment amount. For example, if the initial investment is €30,000, then:

• 90% capital guarantee gives a minimum return of €30,000 x 90% = €27,000.

2. Calculate the growth of the underlying asset. If the asset grows by 5%, then:

• Growth amount = €30,000 x 5% = €1,500.

3. Apply the participation rate to this growth. With a 150% participation rate:

• Investor's share of growth = €1,500 x 150