Guaranteed Fund Forte 4

A new guaranteed fund offered by Komerční pojišťovna, a.s., which opens new possibilities for the investment strategy under the Vital Invest life insurance. This fund is perfect for clients who understand that there is a great potential for growth of share and commodity prices but are not willing to be exposed to a risk that the value of their investment might decrease.

Guaranteed Fund Forte 4 offers:

• guarantee of a 100% return on the investment upon the fund’s maturity (after deduction of administrative costs)
• possibility of a 30% yield after only 3 years (10 % p.a.)
• possibility of a yield of up to 70% after 7 years (10 % p.a.)
• attractive portfolio of underlying assets (American, West European and Chinese shares, commodity, currency strategies)
• opportunity to participate in the growth of stock and commodity markets. Share and commodity prices are now several per cent under their historical maximum from 2008
• protection against currency risk (potential negative impacts of the Czech crown strengthening are reinsured and will not affect the portfolio yield)
• the portfolio is managed by professionals from the French company Société Générale, which is one of the largest and most stable banks operating in the Eurozone

Insurance contract elements in case of investing into the Guaranteed Fund:

• single premium
• minimum insurance period of 9 years
• subscription period: 11/10/2010 – 28/01/2011 (or until the fund is sold out)

The content of the risky assets basket changes every month depending on the performance of these assets. Five underlying assets, having had the best performance in the previous month, are selected for the basket each month. Thanks to this strategy we are able to respond to changes in market trends more effectively and the probability of premature redemption of the fund is also higher.

Each month, the content of the risky assets basket is selected out of 7 stock and commodity indexes and 2 exchange rates formed by the “SG Best Allocator 2 Index“ (also referred to as the “Index“).

How is the monthly performance of the SG Best Allocator 2 Index calculated?

The monthly performance of the Index (performance of 5 selected risky assets) is governed by the following rules:

• if the performance of the Index for the relevant month ranges between −10 % and +4 %, the real performance of the Index is included in the monthly performance
• if the performance of the Index for the relevant month is lower than −10 %, a value equal to −10 % is used for the calculation
• if the performance of the Index for the relevant month is higher than +4 %, a value equal to +4 % is used for the calculation

According to the performance development of the SG Best Allocator 2 Index, the fund will mature in three to eight years.

Fund’s maturity after 3 years

• if, by 10/02/2014, the sum of monthly Index performances is higher or equal to 20 %, the client will receive a 30% yield + 100 % of the initial investment (after deduction of administrative costs))

Fund’s maturity after 4 years

• if, by 09/02/2015, the sum of monthly Index performances is higher or equal to 20 %, the client will receive a 40% yield + 100 % of the initial investment (after deduction of administrative costs)

Fund’s maturity after 5 years

• if, by 08/02/2016, the sum of monthly Index performances is higher or equal to 20 %, the client will receive a 50% yield + 100 % of the initial investment (after deduction of administrative costs)

Fund’s maturity after 6 years

• if, by 08/02/2017, the sum of monthly Index performances is higher or equal to 20 %, the client will receive a 60% yield + 100 % of the initial investment (after deduction of administrative costs)

Fund’s maturity after 7 years

• if, by 08/02/2018, the sum of monthly Index performances is higher or equal to 20 %, the client will receive a 70% yield + 100 % of the initial investment (after deduction of administrative costs)

Unless the condition of the premature redemption is met within 7 years, the client will receive, upon the maturity of the fund (after 8 years), an amount according to the following rule:

• if the sum of recorded monthly Index performances is positive after these 8 years, the client will receive the actual yield of the fund + 100 % of the initial investment (after deduction of administrative costs)
• if the sum of recorded monthly Index performances is negative after these 8 years or equals 0, the client will only receive 100 % of the initial investment (after deduction of administrative costs)

Example 1 – fund’s maturity after 3 years (clients gain a 30% yield to their investment)

Example 2 – fund’s maturity with a positive yield after 8 years

Example 3 – fund’s maturity after 8 years Clients receive 100 % of the investment (after deduction of administrative costs)