Structured Investment Group has launched its first product, a six year growth plan linked to the performance of four indices.
The six-year global equity plan, the Equity Index Allocation Optimiser, allocates to four indices at maturity based upon their performance, including the FTSE 100, S&P 500, DJ Eurostoxx 50 and MSCI Emerging Markets indices.
A positive weighting is only taken in the three best performing market indices, with zero weighting to the worst performing market. 50 per cent is allocated to the best performing index, 30 per cent to the second best performing index, 20 per cent to the third best performing index and nothing is allocated to the worst performer.
Capital protection on the product is linked to FTSE 100 index. If the final index level of the FTSE 100 is 40 per cent lower than the initial index strike level, capital will be lost on a one-for-one basis, in line with the percentage fall of the index.
The counterparty to the plan is Morgan Stanley. The closing date for investments is 23 November or 26 October for ISA transfers. The plan will strike on 30 November. The minimum investment is £3,000.
Structured Investment Group chief executive Adrian van den Bok says: “In the current economic environment, low interest rates, high inflation and market uncertainty remain at the forefront of investor’s minds. Identifying the optimal asset allocation at this time is undoubtedly tough, for advisers and investors.
“The Equity Index Allocation Optimiser provides an investment that determines asset allocation by formula, retrospectively, based upon known performance, giving investors the benefit of hindsight. We believe this strategy both optimises returns and more clearly defines and better mitigates the risk to capital.”
Lowes Financial Management managing director Ian Lowes says: “This is an interesting, long awaited first product from SIG. I like plans that asset allocate retrospectively and this something that can only really be done with structured product.
“On the downside, it is slightly complicated and may take a little while for advisers to understand and to explain to clients.”