There are a number of structured investment products with a variety of investment risk, meaning there should be something to suit all attitudes to risk. However, they are not right for everybody, and you should assess the pros and cons before making any decisions.
Pros of structured investment products:
- Stock market linked for potentially high returns
- Some or all capital protection
- Fixed terms which allow for planning
Cons of structured investment products:
- They do not allow for regular investment
- They cannot offer guaranteed returns
- They do not allow instant access
If you want to know more about structured investment products and the range of options available to you, 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).