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The National and UBS Warburg have joined forces to offer a market leading Protected Equity Product (PEP).
This joint offering combines the financial expertise and distribution strength of Australia's largest commercial bank with the product knowledge, solutions and market research of Australia's leading investment houses, UBS Warburg.
The PEP allows investors to borrow funds from UBS Warburg (min. $50,000) to invest in a selection of 58 companies listed on the ASX. Holding the product until maturity, the investor is without risk of capital loss and the only cash outlay and consequently the only amount an investor can lose, is the interest on the loan*.
PEP is subject to an Australian Tax Office product ruling that allows for the interest to be tax deductible. The extent and timing of the deductions vary according to specific individual circumstances and are outlined in the ruling.
"We have teamed with UBS Warburg to deliver a premium Protected Equity Product with an Australian Tax Office product ruling," said Mr Rob O'Callaghan, Head of Debt Markets Trading at The National.
Where requested by the client The National can assess their specific needs and goals to create an individual investment strategy to maximise their personal success. It uses product manufacturers, such as UBS Warburg, to assist in designing a solution to meet these needs and provide an overall strategic investment model.
Mr Steuart Roe, Head of Risk Management Products at UBS Warburg, said, "The matching of interest rate with stock selection means that the PEP has a low interest rate charge. This addresses the issue of using one rate for all the stocks, which can result in the highest interest rate being charged based on the most risky stock available".
The selection of approved securities available for investment includes selected small cap stocks and most blue chip stocks. Baskets of sector portfolios are also available including banks, fallen leaders, healthcare and biotech and a selection from UBS Warburg's model portfolio.
To help investors make a more informed decision, the offering includes a research compendium that covers many of the stocks. The compendium details UBS Warburg's analyst forecasts, ratings, and views on future earnings potential, and is based on UBS Warburg's highly rated institutional research.
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Share 1
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Share 2
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Share 3
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Share 4
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Total
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| Share Purchase Price |
$20 |
$10 |
$17 |
$12 |
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| Starting value |
$50,000 |
$50,000 |
$50,000 |
$50,000 |
$200,000 |
| Quantity of Shares in Portfolio |
2500 |
5000 |
2941 |
4167 |
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| Share Price at Maturity |
$30 |
$8 |
$7 |
$20 |
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| Value at Maturity |
$75,000 |
$40,000 |
$20,588 |
$83,333 |
$218,922 |
| Capital Gaine/Loss without PEP |
$25,000 |
-$10,000 |
-$29,412 |
$33,333 |
$18,922 |
| Value at Maturity with PEP |
$75,000 |
$50,000 |
$50,000 |
$83,333 |
$258,333 |
| Capita Gain/Loss with PEP |
$25,000 |
$0 |
$0 |
$33,333 |
$58,333 |
Further information:
National Online Trading
Megan Donald, UBS Warburg (02) 9324 3335 or 0417703189
Katherine O'Regan, National Australia Bank, (02) 9957 8591 or 0419 411 801
About UBS Warburg:
UBS Warburg is Australia's leading investment bank with over 700 people in Sydney, Melbourne and Auckland. UBS Warburg is ranked Number 1 in all of its core businesses - M&A activity, equity trading and fixed income expertise. The group currently has an 11% market share of all stocks traded on the ASX, the largest volume in the market, and a number of top ranked analysts in key sectors including banking, property, economics and gold.
About The National Private Bank:
Inside one of the world's largest banks is a small bank - The Private Bank at the National. Clients of this exclusive service can rest assured that no detail will be too small, no transaction too large and no issue too complex for their Private Banking team to handle. From everyday transactions to financial estate planning and from investment advice to the 24 hour personal service clients receive, Private Banking at the National is a relationship defined by our clients unique requirements designed to maximise our clients personal success.
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