Macquarie Highpoint investors already locking in their profits

16 November 2004

Kiwis who braved a return to international equities through Macquarie's Highpoint Trust (Highpoint) in May 2003 have locked in gains of 20%, just 18 months into the investment's 7.5 year term.

Investors in Highpoint had the choice of investing in United States equities through units tracking the S&P 500 index, or in United Kingdom equities through units tracking the FTSE 100 index.

Both classes of units have now locked in gains of 20%, following the FTSE 100 index reaching a closing price of 4739.8 on Friday, November 5th.

Each time either index reaches a point another 10% higher than its May 16th, 2003 start date, then another lock-in will occur, up to a maximum of 105% gain for S&P 500 index units and 110% for FTSE 100 index units. Investors cannot lose their locked-in gains because, even if the indexes fall, gains are protected at the previous highest lock-in.

Head of Macquarie New Zealand's Financial Services Group, John Rowley, said that the company was pleased with the performance of the product, and that it was rewarding investors who had chosen to return to international equities, despite the 2000 – 2002 international sharemarket slump.

Kiwis badly mistimed their exit from the world's largest equities bull market, which occurred from 1997 to 2000, when the S&P 500 index gained 99%. During this time Kiwis invested just $340 million more than they withdrew.

However, as the bubble burst and markets began to fall from 2000, New Zealanders invested some $3.3 billion up to June 2001. World markets plunged, with the S&P 500 index falling 40% between 2000 and 2002, leaving many Kiwis badly burned.

Macquarie developed Highpoint for the New Zealand market in the wake of that slump, creating a product that offered Kiwi investors exposure to the growth potential of UK and US equities with no downside risk to their initial capital invested, plus the opportunity to lock in gains as equities markets rose.

Mr Rowley said the success of Highpoint demonstrated that investing in international equities did not necessarily need to involve high risk.

“Investors requiring capital growth to meet their future financial obligations need exposure to growth assets such as shares. Capital protected investments allow them to do this without fear of losing their capital but Highpoint goes one step further by locking in each 10% gain made along the way.”

Highpoint Trust (Highpoint) is offered by Macquarie Investment Services Limited ABN 73 071 745 401 (“MISL”).

Highpoin's protection benefits stem from its investment in equity linked notes issued by Barclays Bank PLC (Barclays). Units in Highpoint are not bank deposits or otherwise guaranteed by Barclays. You should always consult with your investment or other financial adviser to determine whether investment in Highpoint Debentures is suitable for your particular financial needs, circumstances and/or objectives.

MISL is not an authorised deposit-taking institution for the purposes of the Banking Act (Cth) 1959, and MISL's obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of MISL.

Macquarie Bank Limited is a company incorporated in Australia and authorised under the Banking Act 1958 (Australia) to conduct banking business in Australia. Neither Macquarie Bank Limited nor any member of the Macquarie Bank Group are registered as a registered bank in New Zealand by the Reserve Bank of New Zealand under the Reserve Bank of New Zealand Act 1989 (New Zealand).

For further information:

John Rowley
Head of Macquarie Financial Services Group
Macquarie New Zealand Limited
Phone +64 9 363 1459
Mobile +64 21 434 377
Email john.rowley@macquarie.com

Hamish Anderson
Marketing Manager, Macquarie Financial Services Group
Macquarie New Zealand Limited
Phone +64 9 363 1435
Mobile +64 21 513 431
Email hamish.anderson@macquarie.com