CompareStructuredProduct.com - 21/09/2022
Max Darer, Lowes Financial Management
Lowes have been reviewing the structured product market for over 20 years, with an increasing database of over 8,500 products. Since 2000 we have been publicly identifying which new offers we ‘Prefer’ and our selection process has stood the test of time, as demonstrated in our annual performance reviews. Our methodology for identifying ‘Preferred’ solutions is based upon research and cross referencing against other available structured investments to distinguish which are, in our opinion the best value and considering our market viewpoint at the time.
Currently, there are a number of available plans that we have marked as ‘Preferred’, representing a mix of capital at risk and capital protected deposit-based plans.
The following plans offer an insight into what we currently ‘Prefer’, focusing solely on the capital-at-risk space in this instance.
|Name||Counterparty||Underlying Index||Shape||Potential Gain Each Year||Maximum Term||Protection Level as % of Start Level|
|Walker Crips UK Annual Kick-Out Plan (GS172)||Goldman Sachs||FTSE 100 Index||At-the-money||8.75%||6 years||60%|
|Walker Crips UK Step Down Kick-Out Plan (CT055)||Citigroup||FTSE 100 Index||Step down||8%||7 years||65%|
|Walker Crips UK 95% Annual Kick-Out Plan (CT053)||Citigroup||FTSE 100 Index||Defensive||8.5%||8 years||65%||Mariana 10:10 Plan November 2022 (Option 2)||Morgan Stanley||FTSE CSDI||At-the-money||11%||10 years||70%|
Backed by Goldman Sachs, this maximum six-year plan features the potential to mature on any of the plan's anniversaries from year two onwards. Early maturity will be triggered provided that the FTSE 100 Index closes at a level equal to, or higher than the Initial Index Level, returning the capital investment in full, plus an 8.75% gain for each year the plan has been in force.Walker Crips UK Step Down Kick Out Plan (CT055)
Backed by Citigroup, this maximum seven-year plan features the potential to mature on any anniversary from year two onwards, with an 8% gain for each year held. Early maturity will be triggered provided that the FTSE 100 Index closes at, or above, a reducing reference level. The Reference Level in years two, three and four is 100% of the Initial Index Level and this level is reduced by 5% on each subsequent anniversary and so will be 95%, 90%, and 85% of the initial level for years five, six and seven respectively.Walker Crips UK 95% Annual Kick-Out Plan (CT053)
Again backed by Citigroup, this maximum eight-year plan features the potential to mature on any of the plan's anniversaries from year two onwards. Early maturity will be triggered provided that the FTSE 100 Index closes at a level equal to, or higher than 95% of the Initial Index Level, returning the capital investment in full, plus an 8% gain for each year the plan has been in force.Mariana 10:10 Plan November 2022 (Option 2)
Backed by Morgan Stanley & Co. International plc this maximum ten-year and two-week plan features the potential to mature on any of the plan's anniversaries from year two onwards, provided that the FTSE CSDI closes at a level equal to, or higher than the Initial Index Level, returning the capital investment in full, plus an 11% gain for each year the plan has been in force.
The FTSE CSDI (FTSE Custom 100 Synthetic 3.5% Fixed Dividend Index) is effectively the FTSE 100 total return index from which 3.5% per annum is deducted, this being the long-term average dividend yield of the shares in the FTSE 100 index. The FTSE CSDI, which is approximately 99% correlated with the FTSE 100 Index, will underperform the FTSE 100 if the annual dividends are less than 3.5% and out-perform if they are more. Even though the current forecast is that FTSE 100 dividend yield will be slightly higher than 3.5%, some counterparties still offer enhanced coupons for plans linked to this index because they do not need to factor in any margin for a potential fall in dividends.
The chart below illustrates the maturity trigger levels for each plan, along with the relevant capital protection barrier.
For full details on all available products, including those we ‘Prefer’, please click here. The Mariana 10:10 Plan November 2022 will be available on CompareStructuredProducts.com in the next week.Structured investments put capital-at-risk. 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.