Income
ETRACS Monthly Pay 2xLeveraged Dow Jones Select Dividend Index ETN
The ETRACS Monthly Pay 2xLeveraged Dow Jones Select Dividend ETN (Ticker: DVYL) ("DVYL" or the "ETN") is an exchange-traded note linked to the monthly compounded 2x leveraged performance of the Dow Jones U.S. Select Dividend IndexSM (the "Index") reduced by the Accrued Fees.
Profile
| Name |
Monthly Pay 2xleveraged Dow Jones Select Dividend Index ETN |
| Underlying Index |
Dow Jones U.S. Select Dividend Index SM |
| Issuer |
UBS AG |
| Ticker Symbol |
DVYL |
| Index Ticker |
DJDVP |
| CUSIP |
90268G 607 |
| Primary Exchange |
NYSE Arca |
| Initial trade date |
May 22, 2012 |
| Maturity date |
May 22, 2042 |
| Leverage |
2x Leverage with Monthly reset |
| Annual Tracking Rate |
0.35% per annum |
| 2x Index yield* |
7.9% |
*Based on 2 times the index dividend yield calculated in USD as of April 30, 2012 by Standard & Poor's Fianncial Services LLC. Investors are not guaranteed any coupon or distribution amount.
See 'Risks considerations & Benefits' as well as the 'Important legal information specific to ETRACS ETNs' link below for more information.
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Market data
| Closing Price |
35.67 |
Volume |
6,411 |
| Net Change |
-0.35 |
20 Day Volume Average |
3,500.95 |
| % Change |
-0.01 |
Shares Outstanding |
400,000 |
| High (52 week) |
37.66 |
Market Cap |
14,267,959.59 |
| Low (52 week) |
23.88 |
Daily Indicative Value |
35.88 |
| Updated on: May 24, 2013
|
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Distributions
| Payment date |
Amount per security |
Ex-date |
Record date |
| 03/21/2013 |
$0.3130 |
03/11/2013 |
03/13/2013 |
| 02/21/2013 |
$0.0857 |
02/08/2013 |
02/12/2013 |
| 01/23/2013 |
$0.1409 |
01/10/2013 |
01/14/2013 |
| Total annual dividend paid 2012: $1.1997 |
| 12/21/2012 |
$0.2769 |
12/11/2012 |
12/13/2012 |
| 11/21/2012 |
$0.0930 |
11/08/2012 |
11/13/2012 |
| 10/22/2012 |
$0.1900 |
10/10/2012 |
10/12/2012 |
| 09/21/2012 |
$0.2706 |
09/11/2012 |
09/13/2012 |
| 08/20/2012 |
$0.0861 |
08/08/2012 |
08/10/2012 |
| 07/23/2012 |
$0.2831 |
07/11/2012 |
07/13/2012 |
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Top 10 Index constituents
| Company |
Adjusted weight (%) |
| Lorillard Inc. |
3.94 |
| Lockheed Martin Corp. |
2.89 |
| Chevron Corp. |
2.06 |
| Kimberly-Clark Corp. |
1.92 |
| CenturyLink Inc. |
1.91 |
| Entergy Corp. |
1.88 |
| Integrys Energy Group Inc. |
1.8 |
| PPG Industries Inc. |
1.77 |
| McDonald's Corp. |
1.72 |
| Clorox Co. |
1.58 |
Source: "Dow Jones U.S. Select Dividend IndexSM Fact sheet." © CME Group Index Services LLC 2012.
Information as of April 30, 2012.
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Risks and Benefits
An investment in the ETRACS ETNs involves risks. Selected risks are summarized here, but we urge you to read the more detailed explanation of risks described in the “Risk Factors” section of
the prospectus supplement for the ETRACS ETNs (the “ETRACS Prospectus”). Capitalized terms used below (and elsewhere in this document) but not defined herein shall have the meanings attributed to them in the ETRACS Prospectus.
Benefits:
- Monthly compounded 2x leveraged exposure to the Dow Jones U.S. Select Dividend Index SM, less fees, making it the only exchange-traded product with leveraged exposure to this index.
- Monthly leveraged resetting, which provides an innovative alternative to daily leverage resetting typically used in other leveraged products.
- Significant income potential in the form of a variable monthly coupon linked to 2 times the cash distributions, if any, on the index constituents.
- Convenience of a single, exchange-traded security.
Risks:
- You may lose some or all of your principal - The ETNs are fully exposed to any decline in the level of the Index. The monthly compounded leveraged return of the Index will need to be sufficient to offset the negative effect of the Accrued Fees and Redemption Fee, if applicable, less any Coupon Amounts and Stub Reference Distribution Amount, if any, in order for you to receive an aggregate amount over the term of the ETNs equal to your initial investment in the ETNs. If the monthly compounded leveraged return of the Index is insufficient to offset such negative effect, or if the monthly compounded leveraged return of the Index is negative, you will lose some or all of your investment at maturity or call, or upon early redemption or acceleration.
- Correlation and compounding Risk - A number of factors may affect the ETN’s ability to achieve a high degree of correlation with the performance of the Index, and there can be no guarantee that the ETN will achieve a high degree of correlation. Because the Current Principal Amount is reset monthly, you will be exposed to compounding of monthly returns. As a result, the performance of the ETNs for periods greater than one month is likely to be either greater than or less than the Index performance times the leverage factor of two, before accounting for Accrued Fees and the Redemption Fee, if any. In particular, significant negative monthly performances of your ETNs may not be offset by subsequent positive monthly performances of equal magnitude.
- Leverage risk - The ETNs are two times leveraged long with respect to the Index, which means that you will benefit two times from any positive, but will be exposed to two times any negative, monthly performance of the Index, before accounting for the Accrued Fees and Redemption Fee, if any.
- Market risk - The return on the ETRACS ETNs, which may be positive or negative, is linked to the monthly compounded leveraged return on the Index as measured by the Index Factor, which, in turn, is affected by a variety of market and economic factors, interest rates in the markets
and economic, financial, political, regulatory, judicial or other events that affect the Index Constituent Securities or the markets generally.
- Credit of Issuer - The ETNs are senior unsecured debt obligations of the issuer, UBS, and are not, either directly or indirectly, an obligation of or guaranteed by any third party. Any payment to be made on the ETRACS ETNs depends on the ability of UBS to satisfy its obligations as
they come due. As a result, the actual and perceived creditworthiness of UBS may affect the market value, if any, of the ETNs prior to maturity or call, or upon acceleration or early redemption. In addition, in the event UBS were to default on its obligations, you may not receive any amounts owed to you under the terms of the ETNs.
- You are not guaranteed a coupon payment - You will not receive a coupon payment on a Coupon Payment Date if the Reference Distribution Amount for your ETNs is zero.
- The calculation of the Reference Distribution Amount and Stub Reference Distribution Amount may have to take into account withholding taxes, consequently reducing the Coupon Amount.
- A trading market for the ETRACS ETNs may not develop - Although we intend to list the ETNs on on NYSE Arca, a trading market for the ETNs may not develop. Certain affiliates of UBS may engage in limited purchase and resale transactions in the ETNs, although they are not required to and may stop at any time. We are not required to maintain any listing of the ETNs on NYSE Arca or any other exchange.
- Minimum redemption amount - You must elect to redeem at least 50,000 of the ETNs for UBS to repurchase your ETNs, unless we determine otherwise or your broker or other financial intermediary bundles your ETNs for redemption with those of other investors to reach this minimum requirement and there can be no assurance that they can or will do so. Therefore, the liquidity of the ETNs may be limited.
- Your redemption election is irrevocable - You will not be able to rescind your election to redeem your ETNs after your redemption notice is received by UBS. Accordingly, you will be exposed to market risk in the event market conditions change after UBS receives your offer and the Redemption Amount is determined on the Redemption Valuation Date.
- Potential automatic acceleration - In the event the indicative
value of the ETNs is equal to $5.00 or less on any Trading Day or decreases 60% in value from the closing indicative value of the ETNs on the previous Monthly Valuation Date, the ETNs will be
automatically accelerated and mandatorily redeemed by UBS and you will receive a cash payment equal to the Acceleration Amount as determined during the applicable Measurement Period. The Acceleration Amount you receive on the Acceleration Settlement Date may be significantly less than $5.00 per ETN and may be zero if the price of the ETNs continues to decrease during trading on one or more Trading Days during such Measurement Period.
- Uncertain tax treatment - Significant aspects of the tax treatment of the ETRACS ETNs are uncertain. You should consult your own tax advisor about your own tax situation.
- UBS’s Call Right - UBS may redeem all outstanding ETNs at any time on or after the date specified in the pricing supplement, as described in the ETRACS Prospectus.
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UBS has filed a registration statement (including a prospectus, as supplemented by a prospectus supplement for each offering of the ETRACS ETNs) with the Securities and Exchange Commission (the "SEC") for the offerings to which this communication relates. Before you invest, you should read these documents and any other documents that UBS has filed with the SEC for more complete information about UBS and the offerings to which this communication relates. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, you can request the prospectus and any applicable prospectus supplement by calling toll-free (+1-877-387 2275).
Products and services in this web site may not be available for residents of certain jurisdictions. Please consult the restrictions relating to the product or service in question for further information. Activities with respect to US securities are conducted through UBS Securities LLC, a US broker dealer. Member of SIPC.
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