This sector defines the proportion of the underlying benchmark’s appreciation that the PPN earns. For example, if the participation rate is 30% of the underlying benchmark and the benchmark increases in value by 15%, then the PPN will earn 4.50% (30% of 15%). There is no single, standardized formula used in PPNs to define the investor’s maximum investment returns. The formula can be simple or very complex. It can include criteria that define the influence of negative performance by all or a single benchmark constituent. For example, the formula might stipulate a maximum participation rate in positive performance at 30%, but the participation rate for negative performance might be 100%. This would shift the final PPN variable return toward 0.00%.