SocGen launches into US deposit space with Wells Fargo certificate
Société Générale (SG) has wrapped its proprietary long short strategy, Wise, into a certificate of deposit (CD) issued by Wells Fargo. The CD links to a volatility controlled version of the strategy, the SGI Wise US Vol Target 8% Excess Return Index.
The CDs, which will price on August 24, last six years and will pay either 100 or 110% participation in the index, with the exact level to be set at pricing. Capital is protected in full at maturity, and covered by the Federal Deposit Insurance Corp up to a value of US$250,000 in the case of Wells Fargo's insolvency.
Wise is a market neutral proprietary model which was invented by SG in 2000. The index used in the CD is a volatility overlay built on a the SGI Wise US Long Short Index
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