The Defensive Growth Collection Series 1 has been designed to deliver returns linked to the FTSE 100 in rising or falling markets.
A client’s credit risk is split across five UK financial institutions: HSBC Bank, Nationwide Building Society, Santander UK, The Royal Bank of Scotland and Lloyds TSB Bank.
The FTSE 100 Defensive Kick-Out Plan 1 has potential for maturity at the end of each year after the first one, with a payment equal to 8.5% per year, as long as the FTSE 100 is higher than 90% of its starting level.
Investors’ initial investment is at risk only if no early maturity occurs and if the FTSE 100 finishes lower than 50% of its starting level.
Meanwhile the FTSE 100 Defensive Returns Plan 1 give investors 100% of any increase in the FTSE 100 with no upper limit on the maximum return.
If the FTSE 100 falls investors also receive a return up to a maximum of 50%. Half of the initial investment is at risk of the index finishes lower than 50% of its starting level.
Gary Dale, head of intermediary sales, said: "Structured Investments with defensive pay-offs are not a new phenomenon but in the current climate are certainly proving popular with many different issues available from a variety of providers.
"Traditional equity investors accept that markets are volatile and returns are largely dependent upon asset growth, but we are starting to see real appetite for ‘defensive’ type pay-offs where investors stand to profit when equity markets fall."
