20 April 2023: Wealth Product Ideas
Chinese Chipmakers Investment Theme
- As a result of Beijing’s recent investigation into Micron, stocks related to Chinese chips have experienced an uptick.
- This probe is being viewed as a fresh battleground in the chip war between Beijing and the US, and investors are speculating that domestic Chinese companies may reap the benefits.
- The storage chip industry in China is more advanced compared to the domestic logic industry, thus offering investment prospects.
- CITIC Securities analysts forecast that Micron clients could transfer orders to local suppliers, which would result in a windfall for domestic Chinese companies.
- Investors may want to consider investing in this theme via FCN to obtain a steady income and to reduce potential downside risks as opposed to direct investments.
Payout Scenarios:
- KO Early Redemption: Principal + KO returns (KO event occurs only when the closing price of all underlying securities is higher than the knock-out price)
- Maturity Redemption: Investors receive corresponding interest payments every month, and if no KO event occurs, the payout will be:
- If the final price is higher than or equal to the strike price, investors will receive 100% cash return on their principal, along with the final interest.
- If the final price is lower than the strike price, investors will receive 100% of their principal in the form of shares of the worst-performing stock and will also receive the final interest.
(Source: Bloomberg)
