Structured Products vs Absolute Return Funds

April 25, 2016

In recent years,  the international investment arena has witnessed a huge increase in the popularity of Absolute Return funds that aim for a positive return regardless of how markets perform, usually over a rolling time period of no more than three y…  Read More »

How Structured Products Work

April 17, 2016

This article is a simplified, broad overview of the basic characteristics of Structured Notes. Obviously, each Note is individually customized to meet the requirements of a particular audience so terms and conditions of each Note must be examined ind…  Read More »

Advice is Key

January 27, 2016

Back in 2008/09, the market for structured products was under intense scrutiny by regulators after the collapse of Lehman Brothers left some investors high and dry. The findings of review into the suitability of advice on these structured products (t…  Read More »

Why invest in autocall structured products?

November 15, 2015

Autocall products are increasingly popular with investors, advisers and product providers and should be judged on investors’ comfort, not on missed opportunities. Autocalls, also known as kick-out plans, have captured a large part of the structured product market in recent years. Product providers use them to offer higher payoffs than other SPs that automatically run to a full term. Advisers are using them to generate double-digit returns and provide portfolio diversification. Autocalls pay out a defined return providing a predefined event takes place. A simple FTSE-based product may offer 10% per annum if the index rises by a set amount from its initial starting point. If the trigger event occurs, the plan terminates early and returns investor cash plus the offered coupon. Should the trigger not occur, the plan keeps going to subsequent trigger anniversaries until kick-out conditions are met, rolling up coupons as it goes. If the plan reaches maturity, it pays out the cumulative coupon and returns the initial investment.

Definitions

Many current products are based on single index structures that kick out if the market is flat or higher than its strike rate on each anniversary. Even if plans do not kick out, investors should remember they have not lost an annual coupon, merely rolled it up.

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Guaranteed capital no longer a must have

November 15, 2012

The changing economic environment is forcing cautious investors to take more risks within the structured products market. Cautious investors are now willing to abandon the guarantee return of their initial investment in a bid to chase a higher profit…  Read More »

A Critique of Structured Product Critics

July 18, 2012

A brief news search in your favorite online search engine for “structured products” returns a number of articles from several major financial news organizations’ websites decrying structured products as unfit for savvy investors. Fo…  Read More »

Investing in realty via structured products

July 23, 2010

They will help your capital appreciate and also give guaranteed returns.
Realty had a reality check when it melted furiously and was brought to realistic levels. It’s now back in the limelight, with demand picking up slowly. When there is a dearth of buyers, products get the much needed innovative streak and this is what happened.

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