What is a Dual Currency Investment?
A Dual Currency Investment is a short-term investment product for investors with exposure to two currencies. It is a non-principal protected investment product.
When you invest in a Dual Currency Investment, you need to decide the investment amount, the investment currency, the investment tenor and another alternate currency that you are comfortable receiving your investment in. A part or all of the return that you will receive represents the premium for the option that you sold to the bank.
You can earn an enhanced yield and at maturity, the Principal Amount and Return Amount will be paid in either the Investment Currency or the Alternate Currency (an Alternate Currency pre-defined by you), converted at the pre-selected foreign exchange ("Strike") rate.
You may select any of the major tradable currencies offered by our bank, in which you hold a natural exposure and which you are comfortable to hold in the future.
Features at glance
- Dual Currency Investments are non-principal protected investment products.
- Minimum investment amount of USD 25,000 or equivalent.
- Wide range of currency pairs including USD, AUD, EUR, JPY, HKD, GBP, NZD, CAD, SGD and CHF to choose as the Investment and Alternate Currency.
- Tenors ranging from 1 week to 3 months.
- No withdrawal or early termination of this product by the investors before maturity is permitted.
Enjoy the many benefits of a Dual Currency Investment
- If gives you the potential to earn a substantially higher return than an ordinary savings deposit or term deposit.
- It provides you the flexibility of investment tenor varying from 1 week to 3 months.
- It provides you a tailored investment solution. You can choose the Alternate Currency, strike rate and investment tenor to fit your specific market view and meet your needs of different currencies and liquidity.
- It provides you a wide range of currencies to choose from.
How does a Dual Currency Investment work?
Note: The hypothetical scenarios set forth below are for Illustrative purposes only, and are not representative of historical, actual or future performance.
You place USD 50,000 in a 30-day Dual Currency Investment. You choose AUD as the Alternate Currency.
|Principal Amount||USD 50,000|
|Potential Yield (p.a)||13.39%|
At the maturity Date:
If the prevailing market rate at expiry is above the Strike rate, say 0.8820, you will receive your principal and return in USD.
Principal: USD 50,000
Return: USD 50,000 x 13.39% x 30 / 360 = USD 557.92
Total: USD 50,557.92
At the maturity Date:
If the prevailing market rate at expiry is equal to or below the Strike rate, say 0.8000, you will receive your principal and return in AUD converted at the Strike rate and if taking "Spot rate at maturity = 0.8000" as an example
Principal: USD 50,000
Return in Investment Currency:
USD 50,000 X 13.39% X 30 / 360 = USD 557.92
Maturity Payment to customer:
USD 50,557.92 / 0.8650 = AUD 58,448.46
If you decide to convert the AUD back to USD immediately at the prevailing market exchange rate, you will experience a principal loss:
AUD 58,448.46 X 0.8000 = USD 46,758.77
Principal loss = USD 3,241.23
If you decide to hold the AUD, you may suffer much more losses, if the AUD further depreciates against USD.
What type of investors is a Dual Currency Investment suitable for?
Dual Currency Investments are suitable for those
- seeking potential higher returns than a regular deposit product and being able to bear the possible principal losses.
- who are indifferent to receiving their Principal Amount and Return Amount in either the Investment Currency or the Alternate Currency at maturity, and having specific market view on the foreign exchange.
- who may have potential needs for the Alternate Currency because they:
- have business investments
- are pursuing an overseas education
- have investment properties and housing loans in the Alternate Currencies.
You should understand the risks inherent in the Underlying and possess the relevant investment experience.
What are the key risks of a Dual Currency Investment?
A Dual Currency Investment is a non-principal protected investment product but not a traditional deposit, and should not be treated as a substitute for a traditional deposit.
Any early withdrawal or early termination of this product by you before maturity is not permitted.
Foreign exchange risk
A Dual Currency Investment is subject to foreign exchange fluctuations which may affect the principal and the return on your investment.
You may be exposed to foreign exchange risk as the Investment Currency may not be your preferred home currency of choice. You may incur potential foreign exchange losses if you convert the Investment Currency or Alternate Currency at maturity back to your preferred home currency.
Foreign exchanged controls may be imposed by the country issuing the foreign currency from time to time and may delay or prevent the repayment of the Principal Amount and Return Amount to you.
The investment decision is yours but you should not invest in the Dual Currency Investment unless you are satisfied that you understand the investment nature, sought independent financial advice and /or you have determined that the product is suitable for you taking into account your financial situation, risk appetite, investment experience and investment objectives.
How do I purchase this product?
Contact an our Relationship Manager to set up an appointment today, who will cover the following:
- Understand your current financial position, and your risk appetite.
- Explain the product in more details, including product features and risks.
- Help you to read, understand and sign the Structured Investment Agreement and the General Risk Disclosure Statement.
- Assist you to read, understand and sign the Term Sheet.
- If you do not already have one, help you open an ANZ China Personal Deposit Account. This requires your National ID/Passport.
Note: This document is prepared in both Chinese and English. The Chinese version shall prevail in case of any discrepancy between the two language versions.
Consider Investing today
Get enhanced returns by considering investing in a Dual Currency Investment today. For more information, speak to your Relationship Manager.