Like most financial products, there are pros and cons to structured investment products, and they won't be right for everybody.
However, structured investment products might be right for you if:
- You want some or part of your capital protected
- You can afford to keep your capital locked away for between one and five years
- You want a fixed term investment
On the other hand, structured investment products may not be right for you if:
- There is a chance you will need instant access to your cash
- You want a guaranteed rate of return
- You want the option to invest regularly
For more information about a number of leading structured investment products, see the table above.
The safety of your original capital depends on the ability of the counterparty (the institution providing the underlying assets, rather than the product provider) to repay your investment at the end of the term. You can assess the strength of a counterparty, and therefore the relative risk to your investment, by comparing their credit rating score, from AAA to D, using a credit rating agency such as Standard & Poor's (www.standardandpoors.com) or Fitch (www.fitchratings.com).