An investment adviser here in uk has recently offered the following Callable Accrual note and I would like to know what you "Finance Gurus" would do if you were in my shoes.
It is a 2 years 6 months callable range accrual note in USD. It is given by CommerzBank (corporate & markets):
Issuer: KBC IFIMA, Moody's Aa3 / S&P A+ Payment Date: 17-Mar-05 Maturity: 17-Sep-07 Redemption: 100% of the initial amount Coupon Frequency: Semi-Annually Callability : After 6 m and every 6 m thereafter Spot (6M Libor USD): 3.080%
Semester 1 - coupon of : 4.85% for every day where the 6m libor stays within 4 % Semester 2 - coupon of : 4.95% for every day where the 6m libor stays within 4.2 % Semester 3 - coupon of : 5.05% for every day where the 6m libor stays within 4.4 % Semester 4 - coupon of : 5.15% for every day where the 6m libor stays within 4.5 % Semester 5 - coupon of : 5.25% for every day where the 6m libor stays within 4.5 %
What advice can you give me so that I can analyse this further. Any guidance would really be appreciated.