The enduring appeal of capital protection

structured products

Although the equity markets have recovered, structured products still have a role because they offer capital protection, a precaution against the possibility of falling markets

Over the last year, as of 31 August 2005, the FTSE 100 has risen by 18% and DJ Eurostoxx 50 by 21% - proof that equity markets are indeed recovering. With the recovery in equity markets so evident is there still a place for structured products in the UK retail market? The answer to this is yes, because although when asked, most intermediaries cite capital protection as the main attraction of structured products, there is a lot more to these than the promised full return of capital at the end of the investment term - third party risk aside. A complaint often made about structured product...