The Units in Sequoia Gold Optimiser – Series 2
The Units in Gold Optimiser Series 2 are designed to offer investors the ability to gain exposure to the performance of the London Bullion Market Association Gold Price PM (“Gold Spot Price”) with a 15% Volatility Target Mechanism (“The Strategy”) over a 3-year Investment Term and the potential to receive an uncapped Performance Coupon at Maturity dependent on the Strategy Value Performance after application of the Optimised Profit Lock-in Feature.
- Reference Basket
- Optimised Profit Lock-in Feature
- Ladder Levels
- Corresponding Locked Levels
- Observation frequency
- Potential Performance Coupon
- Limited recourse Loan
- Investment Term
- Annual Interest Rate on Loan (payable for the full 3 years in advance)
- Risk Management Fee (payable for the full 3 years in advance
- Application Fee
- Total Investment Cost (payable upfront)
- Volatility Mechanism
- Volatility Target
- Maximum Participation Rate
- Performance Fee
- Margin Calls
- SMSF Eligibility
- London Bullion Market Association Gold Price PM
- Reference Asset with 15% Volatility Target
- Yes, Profit Lock-in Feature applies based on the Strategy Value closing above the Ladder Level on a monthly closing basis
- 10%/20%/30%/40%/50% This sets the Minimum Performance Coupon payable at Maturity before adjusting for currency movements and the Performance Fee
- The Strategy Value is observed on a monthly closing basis to determine whether or not it has breached a Ladder Level
- Yes, potential uncapped Performance Coupon at Maturity subject to changes in the AUD/USD exchange rate and the Performance Fee
- 3 Years
- 5.95% p.a.
- 0.7% p.a
- Yes, a 10% Performance Fee applies at Maturity
Optimised Profit Lock-in Feature
Series 2 includes an Optimised Profit Lock-in Feature which is intended to lock-in future positive performance in the Strategy Value, assuming the Strategy Value is able to close above any of the Ladder Levels on a monthly closing basis. If this occurs, the Corresponding Locked Level will create a floor to the Performance Coupon payable at Maturity. This applies to the full leveraged investment amount subject to changes in the AUD/USD exchange rate less the deduction of a 10% Performance Fee.
Initial Strategy Value
05 August 2020
Initial Strategy Value
Sequoia Gold Optimiser - Series 2 Performance
|Date||Reference Asset Level||Indicative Unit Value*||Performance|
* Unit Value: Investors please note this is a theoretical investment maturity value. This investment is designed to be held to maturity. Any investors seeking to redeem prior to maturity may receive an amount significantly different to the Indicative Unit Value stated
Key risks include:
- Your return (including any Coupons) is affected by the performance of the Reference Asset. There is no guarantee that the Reference Asset will perform well.
- The Units have varying levels of exposure to the Reference Asset depending on volatility due to the variable Participation Rate. It operates by varying the exposure that the Units will have to the Reference Asset depending on the Realised Volatility of the Reference Asset and the Target Volatility. There is the risk that the Participation Rate could drop to significantly below 100% during the Investment Term in which case Investors will not gain the full benefits of an increase of the value of the Reference Asset.
- Investors should note that there is a lag in measuring the Realised Volatility of the Reference Asset. This means that where there has been a period of high Realised Volatility, the Investor’s exposure to the Reference Asset will be low, regardless of whether the Reference Asset is performing positively or negatively.
- There will be no Performance Coupon payable if no Corresponding Locked Level applies and the Strategy Value Performance is zero or negative on the Maturity Date.
- The Performance Coupon is determined by reference to the Initial Strategy Value, Final Strategy Value and the application of any Corresponding Locked Level at Maturity as well as changes in the AUD/USD exchange rate. An increase in the AUD/USD exchange rate will decrease the Performance Coupon whilst a fall in the AUD/USD exchange rate will increase 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 an 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 will never be required to pay more than the Prepaid Interest Amount and Fees 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.
Please refer to Section 2 “Risks” of the Master PDS for more information
The Sequoia Gold Optimiser Series 2 are issued by Sequoia Specialist Investments Pty Ltd (ACN ) (the “Issuer”) and arranged by Sequoia Asset Management Pty Ltd (ACN , AFSL 341506)(the “Arranger”). Investments in The Sequoia Gold Optimiser Series 2 can only be made by completing an Application Form attached to the Term Sheet Product Disclosure Statement (“TSPDS”) dated 15 July 2020, after reading 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 The Sequoia Gold Optimiser Series 2 . Capitalised terms on the webpage have the meaning given to them in Section 10 “Definitions” of the Master PDS..