List your expected return for the following investment in different scenarios;

B)   Please list the risks and discuss the impacts;

C)    Why you go ahead with that investment by listing your recommendations.

 If you are a CFO who is responsible for your company's investment. World leading C Bank relationship manager came to you and offered you the following investment product; some key features are illustrated in below:  

 

Auto callable Contingent Coupon Equity Linked Securities Linked to an Equally Weighted Basket of Four Underlying Due 31March2025;

 

Issuer: C Bank Group Global Markets Holding Inc. 

Guarantee: All payments due on the securities are fully and unconditionally guaranteed by C Bank Group which is AAA Grade rating; 

  Underlying Company Stock                            Weight

   Advanced Micro Devices, Inc                        25%

   Square, Inc                                                       25%

   Tesla, Inc                                                          25%

   Zoom Video Communications, Inc                25%

   

Stated Principal amount: $1,000 per security;

Issue Date: 31March2021

Pricing Date: 31March2021

Valuation dates: the 5^th Business day of each calendar month

Maturity date: 31March2025 unless earlier redeemed

Coupon Payment: Monthly Dividend at 0.8333% p.m. roughly 10% unless the market value of any underlying company stock is not below 60% of the initial pricing as of 31March2021;

Payment at Maturity: If the securities are not automatically redeemed prior to maturity, callable when any of underlying stock price is below 60% of the initial pricing; If that is the case, your principal payment will be 60% of the initial purchase price + any of previous paid coupon; 

Otherwise, your return will be the ending sales price - previous coupon payment- management fee as of 2%; However capped at 20% capital gain;