RBS rolls out RBS US Large Cap Alternator ETN (ALTL)

Sep 10th, 2012 | By | Category: Equities

RBS Securities, the Royal Bank of Scotland’s US-based investment bank and broker-dealer, has announced the launch of the RBS US Large Cap Alternator ETN (ALTL), the eighth product in its growing suite of exchange-traded notes (ETNs).

Royal Bank of Scotland rolls out RBS US Large Cap Alternator exchange-traded note (ETN) (NYSEarca:ALTL)

The RBS US Large Cap Alternator ETN (ALTL) provides constant exposure to US equities while switching, based on a measure of relative strength, between variants of the S&P 500.

The ETNs will be issued by the Royal Bank of Scotland plc and will be listed on NYSE Arca.

The RBS US Large Cap Alternator ETNs are designed for investors who seek exposure to the RBS US Large Cap Alternator Index (USD), an index that utilises a relative-strength strategy to provide exposure to either the S&P 500 Total Return Index, the S&P 500 Low Volatility Total Return Index or the S&P 500 Equal Weight Total Return Index, depending on the relative strength of the three underlying indices based on their average historical returns.

A relative-strength score is assigned to each underlying index on the last Index business day of each calendar month (determination date) and is the simple average of the returns of that underlying index for the prior one-month, three-month, six-month, nine-month and twelve-month periods. The index will track the return of the underlying index with the highest Relative Strength Score on any determination date for the following month.

Payment on the ETNs is linked to the performance of the index, less an investor fee that is deducted at an annualised rate of 1.00%. Investors have the right to require RBS to repurchase the ETNs on a daily basis, subject to a minimum repurchase requirement.  RBS, at its sole discretion, may also redeem the ETNs at any time prior to maturity.

“Investing in today’s volatile markets is challenging. The RBS US Large Cap Alternator Exchange Traded Note uses a dynamic strategy to offer a straightforward solution to investing in today’s markets by using a relative-strength strategy designed to provide constant large-cap equity exposure by alternating between three well-known S&P Indices,” said Thomas Haines, Head of North American Custom Indices and Listed Products.

The RBS suite of ETNs also includes the RBS China Trendpilot ETN (TCHI), the RBS Global Big Pharma ETN (DRGS), the RBS Gold Trendpilot ETN (TBAR), the RBS NASDAQ-100 Trendpilot ETN (TNDQ), the RBS Oil Trendpilot ETN (TWTI), the RBS US Large Cap Trendpilot ETN (TRND) and the RBS US Mid Cap Trendpilot ETN (TRNM).

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