JPMorgan preps offerings linked to iBoxx $ Liquid High Yield; upcoming notes tied to gold ETF

By Sheri Kasprzak

New York, May 14 - JPMorgan Chase & Co. intends to offer two notes linked to the iBoxx $ Liquid High Yield index.

The Markit index is comprised of the most liquid dollar-denominated sub-investment-grade corporate bond issues.

One of the 5% notes is due Sept. 25, 2013. The payout at maturity for each $1,000 principal amount of notes will be $980.40 plus the index return with exposure to any losses.

Pricing is scheduled for Wednesday.

The investment bank was also set to bring 5% notes linked to the index that are due June 25, 2013.

The payout at maturity for each $1,000 principal amount of these short-term notes will be $992.50 plus the index return with full exposure to losses.

Gold miners ETF seen again

The Market Vectors Gold Miners exchange-traded fund is being linked to another offering, this time to zero-coupon autocallable securities. Citigroup Inc. will price an offering linked to the fund.

The notes, due Nov. 29, 2013, will be automatically called at par plus a premium if the closing share price of the ETF is greater than or equal to the initial share price on any of the first five monthly valuation dates. The premium will be 1.1667% to 1.5833% if the notes are called on June 24, 2.3333% to 3.1667% if they are called on July 24, 3.5% to 4.75% if called on Aug. 26, 4.6667% to 6.3333% if called on Sept. 24 and 5.8333% to 7.9167% if called on Oct. 24.

If the notes are not automatically called and the final share price is greater than or equal to the initial price, the payout at maturity will be par plus a premium of 7% to 9.5%. If the final share price is less than the initial price but greater than or equal to the 85% trigger price, the payout will be par. Otherwise, investors are exposed to the fund's share price decline.

Pricing is set for May 24.

ETF part of JPMorgan notes

Most recently, the ETF was part of a basket with the Russell 2000 index in notes from JPMorgan.

The 10% notes, which are due May 21, 2014, pay par plus accrued interest if both components close at or above their initial levels on any of the quarterly call dates.

A trigger event will occur if either component falls below the 60% trigger level on any trading date. The payout at maturity will be par unless the least-performing component finishes below it initial level and a trigger event occurs, in which case the payout will be par plus the return of the least-performing component, up to a cap of par.

From May 14, 2012, to May 10, 2013, the Market Vectors Gold Miners ETF dropped by 27.24%. The Russell 2000 index climbed by 25.19% over that period.

On Monday, the ETF lost $0.78, or 2.62%, to close at $29.03. The Russell 2000 index dropped by 1.37, or 0.14%, to close Monday at 973.79.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.