JP Morgan launches autocallable gold-linked certificate of deposit
JP Morgan has launched a new certificate of deposit (CD) for US investors linked to the price of gold, as the precious metal's price continues to climb. The CD kicks out as soon as the gold price, taken as the daily fixing level in US dollars per troy ounce, has risen approximately 30% from its level at the product's inception, with the exact percentage to be determined at strike. The payout will also be around 30%.
If gold prices do not hit this level at any time during the product's three-year life, then the investor will participate like for like in whatever appreciation has taken place by maturity. Capital is 100% protected, and investor funds in CDs are also guaranteed by the Federal Deposit Insurance Corp (FDIC) up to a value of US$250 000 in the event that JP Morgan were to become insolvent. Returns are capped at 30, or the approximate level set at strike, which will be at least this figure. If the
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