Old Mutual aims offshore with third US autocall

Old Mutual International Isle of Man is marketing the third tranche of its autocallable structured fund targeted at offshore investors.

This third tranche has been well received by Latin America-based investors, while the previous two tranches had more traction among those based in the Middle East, especially Dubai and Oman, according to a source at the financial institution.

The new tranche, US3 Autocall Fund 3, invests in a structured note issued by BNP Paribas which is linked to the performance of three US shares (Microsoft, Delta Air Lines and UnitedHealth). The fund can mature early on any annual observation date, paying out 10% (not compounded) per period elapsed if all three shares perform positively. If this condition is not met, investors will receive the initial investment in full at maturity, as long as the S&P 500 index does not fall by more than 45%, in which case the capital invested will be eroded one to one with the fall in the index.

The previous two tranches, US3 Autocall Fund 2 and US Autocall Fund 1, were sold at the end of 2014 and, although they had the same payoff structure, they were linked to different baskets of shares including General Electric, Pfizer, Verizon and AT&T, Apple, Merck, respectively.

In 2013, Old Mutual launched three tranches of its Protected Return Fund (with a UK sterling version for the second tranche), another structured fund invested in a note issued by BNP Paribas.

In December 2014, Skandia International changed its name to Old Mutual International. This referred to the company websites, investment-linked products and bank accounts. Old Mutual International Isle of Man used to be known as Royal Skandia Life Assurance.

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Old Mutual aims offshore with third US autocall