By Marisa Wong
Morgantown, W.Va., Dec. 8 – VelocityShares, a Janus Capital Group, Inc. brand, announced the launch of two new oil exchange-traded notes – the VelocityShares 3x Long Crude Oil ETN and the VelocityShares 3x Inverse Crude Oil ETN – linked to the S&P GSCI Crude Oil Index Excess Return. The ETNs are issued by Citigroup Global Markets Holdings Inc. and guaranteed by Citigroup Inc.
The notes will trade on the NYSE Arca under the symbols “UWT” and “DWT,” respectively.
The new ETNs are being launched to provide investors with alternative securities to the VelocityShares ETNs, “UWTI” and “DWTI,” which are being delisted from trading on a public stock exchange, effective this Friday. Those ETNs were issued through Credit Suisse AG, Nassau Branch.
“For years we have worked with sophisticated investors who want to utilize daily trading tools to manage their oil exposure, and we are pleased to be launching these new ETNs to continue to service our clients,” Nick Cherney, senior vice president, head of exchange products for Janus Capital Group, said in a press release.
The new ETNs are linked to the same index and have similar investment structures as the existing ETNs issued by Credit Suisse AG. However, the new ETNs differ in significant ways, including the fact that they have a different issuer and guarantor, the release said.
Citigroup priced $1.6 billion of the UWT notes and $400 million of the DWT notes on Thursday, according to a 424B2 filing with the Securities and Exchange Commission. Details are provided in the tables below.
The new ETNs are the first VelocityShares ETNs issued by Citigroup. VelocityShares ETNs are now offered by three different issuance partners, the press release noted.
Denver-based Janus said its exchange-traded products business represents about $3.8 billion in assets across more than 25 investment products as of Sept. 30.
UWT notes
| Issuer: | Citigroup Global Markets Holdings Inc.
|
| Guarantor: | Citigroup Inc.
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| Issue: | VelocityShares 3x Long Crude Oil ETN
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| Underlying index: | S&P GSCI Crude Oil Index Excess Return
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| Amount: | $1.6 billion
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| Maturity: | Dec. 15, 2031
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| Coupon: | 0%
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| Prices: | Par for initial $40 million
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| Payout at maturity: | Closing indicative value of the notes on the final valuation date; final valuation period is the period of five trading days beginning Dec. 4, 2031
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| Closing indicative value: | $25 at inception; on subsequent days, (a) (i) the closing indicative value on the preceding day times (ii) the daily ETN performance of the notes on that day minus (b) the daily investor fee; closing indicative value will never be less than zero
|
| Daily ETN performance: | (a) one plus (b) the daily accrual plus (c) the index return over the previous day’s closing index level times three; daily accrual is the rate of interest that could be earned on a notional capital reinvestment at the 91-day Treasury rate
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| Daily investor fee: | Annualized amount equal to 1.5% of the closing indicative value on the preceding day
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| Put option: | Subject to minimum of 25,000 notes and 0.08% early redemption charge
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| Acceleration: | If intraday indicative value of notes on any day is less than 25% of prior day’s closing indicative value
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| Inception date: | Dec. 8
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| Settlement date: | Dec. 13 for $40 million
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| Agent: | Citigroup Global Markets Inc.
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| Fees: | None
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| Listing: | NYSE Arca: UWT
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| Cusip: | 17325E291
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|
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| DWT notes
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| Issuer: | Citigroup Global Markets Holdings Inc.
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| Guarantor: | Citigroup Inc.
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| Issue: | VelocityShares 3x Inverse Crude Oil ETN
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| Underlying index: | S&P GSCI Crude Oil Index Excess Return
|
| Amount: | $400 million
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| Maturity: | Dec. 15, 2031
|
| Coupon: | 0%
|
| Prices: | Par for initial $20 million
|
| Payout at maturity: | Closing indicative value of the notes on the final valuation date; final valuation period is the period of five trading days beginning Dec. 4, 2031
|
| Closing indicative value: | $25 at inception; on subsequent days, (a) (i) the closing indicative value on the preceding day times (ii) the daily ETN performance of the notes on that day minus (b) the daily investor fee; closing indicative value will never be less than zero
|
| Daily ETN performance: | (a) one plus (b) the daily accrual plus (c) the index return over the previous day’s closing index level times negative three; daily accrual is the rate of interest that could be earned on a notional capital reinvestment at the 91-day Treasury rate
|
| Daily investor fee: | Annualized amount equal to 1.5% of the closing indicative value on the preceding day
|
| Put option: | Subject to minimum of 25,000 notes and 0.08% early redemption charge
|
| Acceleration: | If intraday indicative value of notes on any day is less than 25% of prior day’s closing indicative value
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| Inception date: | Dec. 8
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| Settlement date: | Dec. 13 for $20 million
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| Agent: | Citigroup Global Markets Inc.
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| Fees: | None
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| Listing: | NYSE Arca: DWT
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| Cusip: | 17325E309
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