CompareStructuredProducts.com - 13/07/2022
Q2 2022 represented a volatile period for UK stock markets. The FTSE 100 Index started the quarter at 7,515, rose to an early high of 7,669 and ultimately fell to a June low of 7,016 - helped by the biggest single day fall in the period where on 16th June the Index lost 3.14%. The Index finished the quarter almost 5% lower. The average closing level throughout the quarter was 7,424.1 – approximately 20 points less than Q1.
210 plans matured in Q2, with all but one realising a capital gain for investors. Collectively, the maturing plans realised an average annualised return of 6.52%, over an average investment term of 3.24 years.
| All Products | Lowes 'Preferred' | Not 'Preferred' | |
| Number of maturing products | 210 | 32 | 178 |
| Number returning a positive outcome | 209 | 32 | 177 |
| Number returning capital only | 1 | 0 | 1 |
| Number returning a loss | 0 | 0 | 0 |
| Average total gain | 22.26% | 32.34% | 20.45% |
| Average term (years) | 3.24 | 3.57 | 3.18 | Average Annualised Return | 6.52% | 8.16% | 6.23% |
| Average Annualised Return Upper Quartile | 8.88% | 10.71% | 8.31% |
| Average Annualised Return Lower Quartile | 4.33% | 6.00% | 4.19% |
32 Lowes ‘Preferred’ plans matured in Q2, returning an average annualised return of 8.16% across an average annualised return of 3.57 years - outperforming the sector average by 1.64%, and the Q1 ‘Preferred’ average by 0.2%. Lowes ‘Preferred’ plans are those we view to be the best available at the time of issuance.
The one maturing plan that failed to achieve a positive return, Investec EVEN 30 Deposit Growth Plan 56, was linked to the performance of the Even 30 Index. This index comprises the thirty least volatile listings on the FTSE 100 Index on an equally weighted basis, with no pre-determined bias to any company or sector. The averaging over the final six months of the plan equated to the index being 5.04% down over the term, meaning that investors original capital was returned in full but with no further interest payment.
Consistent with Q1, no maturity in Q2 resulted in a capital loss for investors.
The ten best performing plans by annualised return are summarised below.
| Provider | Counterparty | Maturity Date | Plan Gain (Annualised) | Term (Years) |
| Mariana | Goldman Sachs | 11/04/2022 | 28% (13.1%) | 2 |
| Walker Crips | Morgan Stanley | 10/05/2022 | 42% (12.39%) | 3 |
| Mariana | Goldman Sachs | 23/05/2022 | 25.3% (11.92%) | 2 |
| Investec | Investec Bank Plc | 04/05/2022 | 23% (10.91%) | 2 |
| Mariana | Goldman Sachs | 11/04/2022 | 22.9% (10.83%) | 2 | Mariana | Goldman Sachs | 23/05/2022 | 21.2% (10.08%) | 2 | Mariana | Citigroup | 10/05/2022 | 32.4% (9.8%) | 3 |
| Walker Crips | Morgan Stanley | 10/05/2022 | 32.25% (9.76%) | 3 |
| Meteor | HSBC | 07/06/2022 | 31.8% (9.63%) | 3 |
| Walker Crips | HSBC | 07/06/2022 | 31.5% (9.55%) | 3 |
Of the ten best performing plans of the period, five were 10:10 Plans, earning an average annualised return of 11.14% over an average term of two years. Full details of the latest 10:10 Plan, the August 2022 edition, can be found here.
When concluding our review of Q1, we mentioned inflation rising to a 30-year high at 7%, emphasising the significance of achieving inflation busting returns. With inflation rising further to 9.1%, we’d like to firmly reiterate our message – now more than ever it is important to invest for real returns to protect the real value of capital.
FTSE 100 data source: Investing.com Structured investments put capital at risk. Past performance is not a guide to the future. Disclosure of interests: Lowes has provided input into the concept, development, promotion and distribution of the 10:10. Lowes has a commercial interest in these investments as a result of its involvement. Where Lowes is involved in advice on these investments to retail clients, it will not receive benefit of any fees for its involvement, other than those fees payable by the client to Lowes.
© CompareStructuredProducts.com is a trading style of Lowes Financial Management, authorised and regulated by the Financial Conduct Authority
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