RAKBANK unveils a unique 10-asset class investment opportunity

The USD Decathlon note is guaranteed by JP Morgan Chase Bank and pays out 100% of the original amount invested plus the average of the 10 best performances, or a minimum of 10%, whichever is the greater.

Named Aquamarine Decathlon, the product is already attracting unusually intense interest, RAKBANK officials report. The principal reason is Decathlon's "pick and drop" strategy that represents a unique method of avoiding many of the vagaries of unpredictable markets.

Every six months, Decathlon picks the best performance from a basket of 10 globally diverse underlyings, locks in the gains and then drops that particular fund or index from the basket. At maturity, the average of each of these best performances is taken.

Particularly beneficial to the investor, apart from the capital-protected nature of the structure, is the rotation of asset performance across a range of asset classes. Aquamarine Decathlon thus allows investors to benefit from the performances of a very diverse group of indices and funds that they may not otherwise be able to take advantage of. They cover equities, commodities, funds, bonds and cash.

The underlyings are Standard and Poors 500, FTSE 100 Index, Dow Jones AIG Commodity Index, Gold, European Properties , Indian equities , the Nikkei 225 Index, Emerging Markets Bonds , Global Governments Bonds and 3 month Cash Index .

The investment rationale, says RAKBANK, is that historically, different assets perform well at different times. The Decathlon note takes advantage of this pattern by selecting and locking in the percentage gains (or losses) from only the best-performing asset for each six-month period of the product's five-year term.

Furthermore, it allows investors unique exposure to certain asset classes that are not readily available to them, such as the Emerging Market Bond index, Gold and Commodities. Constraining decisions are no longer needed, since Decathlon exposes investors to multiple asset categories simultaneously.

The minimum investment required for Decathlon is USD10 000. Built into the Decathlon structure is daily liquidity after the first six months from issue date, minimizing any risk of an investor not being able to exit the strategy. And even if Decathlon performed poorly, investors would nevertheless receive their capital and a minimum 10% return.