The UAE’s Abu Dhabi Islamic Bank (Adib) has launched a new capital-protected note that allows customers to invest in the world’s biggest car manufacturers.
The Shariah-compliant note, which matures in 1 year, provides 100 per cent capital protection at maturity to minimise risk, with an expected return of up to 8 per cent. The note is currently open for subscription with a minimum amount of $30,000 (Dh111, 000).
The note offers the opportunity to profit from the expected growth of the leading car manufacturers in the world including Toyota, GM, Volkswagen, Honda Motors and BMW, the bank said in a media statement today.
The automobile sector has performed impressively in 2013, sustained by the economic recovery and escalating demand in the US and Asia, which has been reflected in stock prices.
General Motors’ stock has surged more than 56 per cent since last year, and Toyota’s share price has improved almost 60 per cent since 2012. The BMW Group has retained its position as world market leader in the premium segment, while Honda’s profit margins have risen through increased sales and a rapid recovery in motorcycle markets and the growth of the North American auto market.
Volkswagen has also registered a significant improvement compared to the first half of the year registering with a €16.6bn net cash position.
Adib’s structured notes have been well received by investors, particularly the three capital-protected gold notes and two capital-protected oil notes that matured at the beginning of 2013. The one-year gold note produced a total return of 15 per cent, while slightly lower-risk notes returned 4 per cent and 6 per cent. One of the two-year oil notes produced a 17.9 per cent return, with the other generating a 1.21 per cent return.
This latest offering is part of Adib’s wealth management approach to provide customers a diversified suite of investment solutions.