All-Star Portfolio Notes, Series 2 launch
ONE Financial Launches Canada's First "Double-Guaranteed" Mutual Fund Product
Innovative Product Offers Investors the Potential for Enhanced Returns, 100% Guarantee of Principal and a Guaranteed Minimum Return at Maturity
Toronto, Ontario - October 16, 2003
ONE Financial has launched Series 2 of the ONE Financial All-Star Portfolio Notes™, a unique debt instrument with the potential to deliver equity-like returns through a link to the performance of some of Canada's top-performing mutual funds. The Notes offer the potential for enhanced performance, are 100% principal protected and provide a guaranteed minimum return of 7% at maturity - a Canadian first for mutual fund-linked investment products.
"Now more than ever investors require a safer way to earn attractive returns on their investments." said Jeffrey O'Brien, Chief Executive Officer of ONE Financial. "At ONE Financial, we're offering investors who want capital protection and the potential for enhanced equity-like returns, an investment with two features that are very unique in the industry. The first is a 'double guarantee': we guarantee investors 100% of their principal, plus a minimum 7% return at maturity. And secondly, we have provided a very innovative structure that offers an investor in the Notes the potential to actually outperform a direct investment in the Notes' underlying investment portfolio. ONE Financial is raising the industry bar once again."
The Notes are available through financial advisors until November 14th for a minimum investment of only $2,000. The product features a principal guarantee from BNP Paribas, one of the world's largest banks, and a diversified portfolio of underlying investments comprised of five of the country's top-performing mutual funds.
Principal protection, superior risk-adjusted performance potential
With investors increasingly concerned with maximizing upside potential while limiting risk exposure, there is a growing demand for principal-protected, equity-linked products. ONE Financial is building its reputation by developing innovative products that embody this investment philosophy. The company's first two products led the way with investment solutions that offer this combination of principal protection and enhanced equity-like performance.
The Notes' performance are linked to a diverse portfolio of top-performing mutual funds managed by some of the country's leading money managers. These mutual funds include:
- CI Global Fund;
- AGF International Value Fund;
- AIC American Focused Fund;
- AIC Diversified Canada Fund; and
- CI Canadian Bond Fund.
"By spreading the Notes' underlying investment portfolio across the country's top money managers, and incorporating diverse investment styles, regions, and asset classes, ONE Financial is providing the potential for superior risk-adjusted performance. It's all about easing the effects of market fluctuations, and giving investors both enhanced growth potential and peace of mind." O'Brien said. "Our purpose is to take an inventive approach to helping Canadians to achieve their financial objectives. We never lose sight of the fact that enabling our investors to avoid losses is just as important as pursuing extraordinary positive performance."
When the Notes mature, in approximately eight and a half years, investors will receive their principal plus the interest generated by the Notes' link to the five underlying mutual funds. Unlike other equity-linked notes, however, if the underlying funds perform well then the Notes have the potential to provide investors with an interest payment even greater than the performance of the underlying funds. And in the event the funds do not perform well, investors are still guaranteed a 7% minimum return on their invested capital at maturity. The Notes also offer a tax-efficient structure that defers taxes on portfolio growth by avoiding interim distributions.
An RRSP-qualified investment
Series 2 of ONE Financial's All-star Portfolio Notes™ qualify as Canadian content for RRSPs, RRIFs, and DPSPs, and are also RESP-eligible.
For investors who wish to sell the investment at any time prior to maturity, ONE Financial and BNP Paribas intend to facilitate a weekly secondary market for the Notes (but are under no obligation to do so). Under certain circumstances such sales will be subject to an early sales charge. Details about the risks of investing in this product, and a complete disclosure on how the return on the Notes is calculated, are contained in the Notes' Information Statement which is available from financial advisors on request.