UAE-based Abu Dhabi Islamic Bank (ADIB) is marketing its second capital-protected structure in response to growing demand from investors seeking to hedge against the price of gold.
Stuart Crocker, global head of private banking group at ADIB, said the launch responds to customers expressing an ongoing interest in gold: "Given its already impressive run, we wanted to give our customers capital protection with multiple risk-reward options."
Depending on the risk tolerance and profile of investors, ADIB's Capital Protected Gold Notes offers three different version including the 80% Capital Protected Gold Note, the 98% Capital Protected Gold Note or the combination of the 98% Gold Note with a selection of mutual funds.
The one-year shariah-compliant and Murabaha-based structure are being pitched to customers as a strategy that will provide stable returns in uncertain market conditions, although the bank is recommending that investors not allocate more than 5% to 10% of any investment portfolio in the note.
ADIB's Capital Protected Gold Notes will be open for subscription until 26 January. Minimum investment for the gold note and mutual fund combination option is $25,000 in the ADIB Capital Protected Gold Note, plus $5,000 in the mutual fund. If chosen as a standalone option, the minimum investment is $30,000.
This product will be available shortly in Recent Additions (Private Banking).