Red card for World Cup financial products
For the World Cup, even banks become bookmakers. They promise: The better the German team does in the tournament, the higher the interest rate will be. The problem is that there's not much money to be made in this way.
Every four years, it happens again: the "World Cup Bonus," the "World Cup Investment Fever," or the "World Cup Savings. As before every World Cup, banks lure new customers with dubious financial products whose interest rates depend on the performance of the German national team. Stiftung Warentest examined the offers more closely and came to a clear verdict: the fan investments are no good for investing money, with a few exceptions on IPL cricket betting sites in indian rupees.
The promise sounds good: the money invested earns a fixed rate of interest, and if the German team is successful at the World Cup, there's something on top. To prevent Schweinsteiger and Poldi from bankrupting the banks, the initial interest rate is often extremely low. Only if the DFB team is successful do investors receive interest that they would have received on other fixed-term deposit accounts even without sports betting - in some cases, they are even lower than that. In principle, the customer agrees to take advantage of interest conditions that the banks offer anyway, only if Germany plays good soccer. Clever investing is different.
The World Cup offers are mostly fixed-term deposit accounts. This means that savers do not see their money again for a certain period of time and receive a fixed rate of interest in return. While lucrative time deposit accounts pay a good two percent interest, the basic interest rate on WM savings products is between 0.3 and 1.0 percent. The interest rate increases depending on the success of the German national team, such as victories, goals and, of course, the World Cup title.
Märkische Bank, for example, offers a basic interest rate of 0.3 percent with a term of nine months. The bank grants a 0.05 percent bonus for every match won by the German team. For the World Cup title, there is another 0.1 percent on top. Should Germany storm to the World Cup title with seven victories in a row, this will result in 0.75 percent. If you invest the minimum amount of 1000 euros, you will win 7.50 euros. If the Germans lose three times and are eliminated in the preliminary round, there is only the basic interest rate and a profit of 3.00 euros.
High fees for World Cup funds
Only a few offers can sweeten the World Cup experience financially, such as the VR FanBonus 2014 from Raiffeisen-Volksbank Aurich. If Germany wins the World Cup, it will receive 2.5 percent for two years, which is more than the usual fixed-term deposits. However, the DFB team first has to win the tournament. If they fail in the preliminary round, they will only receive an interest rate of 0.75 percent. The offer is also only available regionally and is subject to quotas. Volksbank Strohgäu offers an interest rate of up to 2.8 percent, but investors have to have a certain amount of soccer knowledge - and luck. Only those who correctly predict the German team's performance will receive the bonus interest. If you guess wrong, you'll have to settle for the basic interest rate of 0.3 percent.
Investors who trust in Germany's offensive strength can take out the World Cup Savings Bond at Sparkasse Neuss. With every German goal, the one percent basic interest rate increases by 0.01 points. So even with a respectable 20 goals, the interest rate only rises to a total of 1.2 percent.
Many banks are also trying to use the World Cup to sell mixed products consisting of fixed-term deposits and funds to the fan. While the time deposit component also starts with a manageable base interest rate and is often only worthwhile if the title is won, the fund component is subject to price fluctuations. The problem here is that the investor cannot freely choose a fund, but must select from a fund pre-selection of the bank. This means that he quickly ends up in an investment that he might never have made. If the bank then adds an issue discount of up to five percent, it becomes difficult to earn money with the mixed products.
Of course, the financial products for the World Cup are not real sports bets, because investors are not threatened with total loss in the event of a wrong tip or a poor performance by the German team. The World Cup products are simply PR campaigns by the banks, which are using the soccer fever in the country to drive soccer fans into low-interest investment vehicles.