The rate at which an investor participates in the exposure to the Underlying asset. For example, an investment offering 100% Participation would provide for a 1% increase in return for every 1% increase in the value of the Underlying. Investment offering greater than 100% Participation offer enhanced participation in the Underlying. An investment may provide for different rates of upside and downside participation.


The general term used to describe the payment received by an investor under an Option or a Warrant. See Redemption Amount.

Physical Delivery

Obligations arising from the Exercise of an Option are not settled purely through payment of cash, but instead through delivery of the relevant quantity of the Underlying, perhaps against payment of a cash amount. See Cash Settlement.

Point Value

The exchange ratio, i.e. the quantity of the Underlying to which one Warrant relates. The point value varies according to the Underlying. Warrants for the U.S.-Dollar normally relate to U.S.-$ 100. In contrast, XPI warrants only refer to 1/100 of the XPI index.


The difference between the Spot Price of Underlying asset and the Break-even Price. The Premium may also refer to the price of an Option or a Warrant.

Principal Protected

A principal protected Structured Investment provides for a minimum return at Maturity that is at least equal to the original sum invested. Principal protection is subject to the Issuer and guarantor not defaulting on their payment obligations and applies only at maturity. This investment is commonly constructed as a Zero-coupon Bond plus an Option.


A Put gives the holder the right (but not the obligation) to sell a specified quantity of the Underlying at the specified Exercise Price. Depending on its style, the Put can be exercised at any time (in the case of American Style Exercise) or only on its Expiration Date (in the case of European Style Exercise). Exercising a Put only makes economic sense if the Spot Price of the Underlying is lower than the Strike Price. Puts contained in Covered Warrants or Structured Investments are usually settled in cash (see Cash Settlement).


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