Structured notes gain populaity
If nothing else the low interest rates around the World have caused a massive increase in populaity of structured notes in the deVere Group and in the US. In this market they can often be the best way to cover downside without missing out too much on upside of the markets. In the US record sales of structured notes are being recorded. We are seeing the same with deVere.
Structured products, which have set maturities, are created and issued continuously, and they come in multiple flavors.
A structured note, for example, might limit losses at 10% and cap performance at 15% for the period of the contract.
“As the stock market has rebounded, there has been a shift by some investors from capital-protected structured products to capital-at-risk structured products,” said Eric Greschner, director of global education and regulatory initiatives at the U.S. Structured Products Association.
Thus, while structured notes are debt instruments that expose investors to the financial health of the issuing firm, advisers are realizing the biggest risk right now is not embracing risk.