Structured products provide another burgeoning area for potential investment. We monitor their availability and attractiveness by adopting close working relationships with a number of product providers in the market place. Certain structured products have proved very popular in recent years, particularly when equity markets were having a difficult time. For example, assets in so-called ‘guaranteed funds’ have grown considerably.

Structured products, as an asset class, are not inherently low or high risk. Risk varies according to the level of capital protection that a product seeks to provide. Products are also designed to provide varying levels of income or capital appreciation. While they may look to provide guarantees irrespective of market conditions they may also cap prospective investment returns. Alternatively, they may only partially guarantee a return of original capital whilst seeking to enhance the upside potential.

Reading the small print and understanding the features of a particular structure are essential. Structured products can be complicated and can also lack flexibility - but they can play an important part in portfolio construction for certain clients who may have either precise needs or a limited time horizon. Each product is judged on its individual merits by us and incorporated into client portfolios accordingly.



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