Sequoia Commodities – Series 2

Sequoia Commodities – Series 2
Commodity Long/Short Index

The Units in Sequoia Commodities Series 2 offer 100% leveraged exposure to the BNP Paribas Commodity Time-Series Momentum ex-Agriculture and Livestock Index (the “Reference Asset”, “Index” or “BNPP Commodity Index”) for a 2 year period. The Units have the potential to pay an uncapped Performance Coupon at Maturity based on the performance of the Index during the Investment Term applied to the full leveraged Investment Amount, adjusted for changes in the AUD/USD exchange rate.

The BNPP Commodity Index aims to take advantage of consistent commodity performance trends.

This Index is designed to track a systematic, diversified long/short commodity futures strategy developed by BNP Paribas S.A. The Index utilizes a momentum indicator to determine which commodities to go long or short whilst using a risk parity approach to determine the weight of each commodity included within the Index (long or short). The Index gains exposure to the commodities by investing in commodity indices rather than the physical commodities. The Index attempts to exploit momentum in the commodity markets by going long the commodity indices which have recently outperformed and going short those commodity indices that have recently underperformed from a price perspective.

Features
  • Reference Asset / Index
  • Volatility Target
  • Potential Performance Coupon
  • Currency Exposure
  • Limited recourse Loan
  • Investment Term
  • Annual Interest Rate on Loan
  • Application Fee
  • Total Investment Cost
  • Margin Calls
  • SMSF Eligibility
  • Commencement Date
  • Maturity Date
Commodities Series 2
  • BNP Paribas Commodity Time-Series Momentum ex-Agriculture and Livestock Index (Bloomberg code: BNPITMXA Index)
  • Yes, the Index aims to achieve a target 6-month volatility of 5
  • Yes, there is potential for an uncapped Performance Coupon payable at Maturity
  • Yes, the potential Performance Coupon at Maturity is adjusted for changes in the AUD/USD exchange rate during the Investment Term
  • Yes. Investors borrow 100% of the Investment Amount
  • 2 years
  • 2.6 % p.a.
  • 0.65% including GST
  • 5.85% (payable upfront)
  • No
  • Yes
  • 24-May-21
  • 23-May-23

Downloads

To find out more, and to download a copy of the Term sheet PDS and Master PDS, please click on the links below

Reference Asset Starting Value

Date

24 May 2021

BNPITMXA Index

373.0117

Sequoia Commodities - Series 2 Performance

DateReference Asset LevelIndicative Unit Value*Performance
28-May-2021 374.44 $1.000.38%
30-Jun-2021 376.31 $1.040.88%
30-Jul-2021 378.77 $1.041.54%
31-Aug-2021376.98$1.031.06%
30-Sep-2021382.95$1.0472.66%
29-Oct-2021388.25$1.0534.09%

*This represents an indicative level for unwinding your investment on the reporting date and is an indication of the market value of the investment.

Key Risks Key risks include:

  • Your return (including any Performance Coupon) is affected by the performance of the Reference Asset. There is no guarantee that the Reference Asset will perform well.
  • There will be no Performance Coupon payable if the performance of the Reference Asset is negative at Maturity;
  • The potential Performance Coupon is determined by reference to the Reference Asset Performance as well as changes in the AUD/USD exchange rate. An increase in the AUD/USD exchange rate between the Commencement Date and the Maturity Date will reduce the Performance Coupon whilst a decrease in the AUD/USD rate between the relevant dates will lead to an increase in the Performance Coupon;
  • There is no guarantee that the Units will generate returns in excess of the Prepaid Interest and Fees, during the Investment Term. Additionally, in the event of an Investor requested Issuer Buy-Back or Early Maturity Event, you will not receive a refund of your Prepaid Interest or Fees.
  • Gains (and losses) may be magnified by the use of a 100% Loan. However, note that the Loan is a limited recourse Loan, so you can never lose more than your Prepaid Interest Amount and Fees paid at Commencement.
  • Investors are subject to counterparty credit risk with respect to the Issuer and the Hedge Counterparty; and
  • the Units may mature early following an Early Maturity Event, including an Adjustment Event, Market Disruption Event or if the Issuer accepts your request for an Issuer Buy-Back.

Please refer to Section 2 “Risks” of the Master PDS for more information.

For more information, please contact Sequoia at:
invest@sequoia.com.au and 02 8114 2222.

Units in Sequoia Commodities Series 2 are issued by Sequoia Specialist Investments Pty Ltd (ACN 145 459 936 ) (the “Issuer”) and arranged by Sequoia Asset Management Pty Ltd (ACN 135 907 550, AFSL 341506) (the “Arranger”). Investments in the Sequoia Commodities Series 2  can only be made by completing an Application Form attached to the Term Sheet Product Disclosure Statement (“TSPDS”), after reading the Term Sheet PDS dated 19 April 2021 and the Master PDS dated 14 August 2017 and submitting it to Sequoia. A copy of the PDS can be obtained by contacting Sequoia Asset Management on or contacting your financial adviser. You should consider the Term Sheet & Master PDS’ before deciding whether to invest in Units in Sequoia Commodities Series 2.  Capitalised terms on the webpage have the meaning given to them in Section 10 “Definitions” of the Master PDS