Customized Equity Investing
PPNs can be easily customized to respond to current market conditions or investor preferences. Notes can be designed to provide growth or income. Both domestic and global markets can be combined to complement and diversify an investor’s portfolio.
Full Principal Protection
PPNs will provide a full return of the principal invested in a note, regardless of the performance of the underlying investments. Notes are bank deposit liabilities which are senior unsecured debt obligations of the Royal Bank of Canada.
Transparent, Passive and Formulaic
The return on PPNs is based on a formula so the current performance of the notes can easily be calculated at any point throughout the term of the note. The return formula is pre-determined before note issuance and is fully transparent.
- The investor is exposed to the performance of the underlying equity investment. Although the principal is fully guaranteed at maturity, the note may not provide return in the form of coupons or a final variable payment at maturity.
- The note may trade below the initial investment amount over the term of the note, particularly if the underlying equity investment performance is sufficiently negative.
- Although investors might hold a note linked to an underlying equity investment that generates dividends, PPN investors do not receive these dividends.
How it works
Customizing the Return and Protection
Investors have the option to choose from Growth or Income Notes.
Growth PPNs Income PPNs