This is how post-purchase bonds work
Let’s assume a nominal value of EUR 1,000 for a post-purchase bond. The ratio of cash and index portion is 60 to 40 percent, i.e. 600 euros cash portion and 400 euros index portion. The cash portion bears interest at 3 percent per year. Furthermore, our hypothetical post-purchase bond maps the index XY, which we fix at a starting price of 10,000 points on the date of determination. The repurchase thresholds are 90, 80 and 70 percent of our starting price of 10,000 points. At these thresholds, 20 percent of the cash component is shifted to the index component, so that at 70 percent of the starting value or 7,000 points of index XY, the 1,000 euros are fully invested in the index component. The lower index level is therefore used for subsequent purchases.
If the repurchase thresholds are not fallen below or if the index even develops positively, you can participate in the price gain with your share of the index. You will also receive annual interest payments on the cash portion. You will receive the Index Portion profits and your remaining cash portion on the Maturity Date.
In the best case for you as an investor, Index XY initially falls moderately and then corrects sharply upwards again, beyond the starting value. But even if the market were consistently sideways, you would benefit from the interest on the cash portion.