For those of you that are looking for a high degree of safety, and are tired of sitting around waiting for the market to sell off and create some bargains, you might want to consider a safe investment product called MITTS. MITTS can be bought or sold any day the market is open, and they trade on the NYSE and AMEX. Since the International Markets and the Nikkei look attractively priced, I listed a few idea's at the bottom of the page. Of course, you need to access your own risk tolerance and goals before investing.
MITTS: Are “Protected Growth Investments” that are linked to a variety of indexes and various sectors including energy, consumer staples, healthcare/biotech, etc. If fact, you could actually construct a complete index portfolio of large caps, small caps and foreign stocks, all with zero risk to principal if held to the stated maturity date. In the meantime your principal will fluctuate until maturity.
HOW MITTS ARE CONSTRUCTED: When Merrill Lynch brings these securities public, part of the proceeds go into a zero-coupon bond that guarantees the principal at maturity. The remaining balance goes into a long-term index option that locks in the increase in the index over the life of the security. This provides the investor with unlimited upside with zero downside risk if held to maturity.
These investments guarantee that you will receive no less than $10 a share at maturity. The key of course is not to pay more than $10/ share for any MITT. This guarantees that you will receive your money back if the corresponding index collapses.
MLN- Merrill Lynch MITTS Nikkei 225 Index due 9/21/2005
EUM- Merrill Lynch MITTS Major 11 Intl Market Index due 5/26/2006
NKM- Merrill Lynch MITTS Nikkei 225 Index due 8/04/2006
MLJ- Merrill Lynch MITTS Nikkei 225 Index due 3/30/2007
NML- Merrill Lynch MITTS Nikkei 225 Index due 6/27/2007
