Capital-protected products that feature a knock-out are offered in two slightly different versions. As a general rule, investors in these certificates participate 1:1 in any price increases up to the knock-out level. If that threshold is exceeded, the option dimension expires worthless and the investors no longer participate in further price gains. But with one form of these certificates, the investors are credited with a rebate as soon as the knock-out takes place. They no longer participate in the gains, but they at least receive an additional fixed payment at the end of the certificate’s term.
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