FVC review: Citi’s leveraged product could outpace underlying ETF

A newly issued leveraged return note linked to the iShares Russell 2000 ETF could generate greater returns than investing directly in the underlying, but investors’ principal is at risk if the final level breaches the downside buffer

Underlying ETF tracks US small companies

Citi has issued a leveraged return product linked to the iShares Russell 2000 exchange-traded fund (ETF). The product offers a participation rate of 150% of the growth in the underlying, subject to a cap of 139.5%. Underlying growth of 26.33% is required in order to achieve the maximum potential return. Any growth above this level will not be passed on to investors.

Points for

1. A potential return of two times the growth in the fund up to a maximum of 39.5% (in addition to the principal amount