Morgan Stanley launches two structured products
Morgan Stanley launches Defensive Bonus plan three and the Morgan Stanley FTSE Defensive Digital Growth plan seven.
Morgan Stanley FTSE Defensive Digital Growth plan seven, a two-year product, will return 12 per cent to investors if the FTSE 100 index has not fallen by more than 15 per cent at maturity.
If the Index has fallen by more than 15 per cent at maturity, no growth return is generated but capital will be returned in full as long as the FTSE 100 index not fallen by more than 50 per cent on the maturity date.
The six-year Morgan Stanley FTSE Defensive Bonus plan three offers 11.5 per cent a year (2 per cent more than on plan two), which is payable on the first observation date (annual from year two onwards) where the FTSE 100 index is at or more than 90 per cent of its initial level.
This means if the initial level of the FTSE 100 index is 5,400 points the plan would kick out if the FTSE 100 index level is 4,888 points or more on any of the observation dates.
If the plan does not kick out then capital is returned in full at maturity as long as the FTSE 100 has not fallen by more than 50 per cent or more.
The plans open for investment today (14 June) and close on 26 July, except for Isa transfers which close on 12 July.
The plans strike on 16 August.
Nev Godley, vice president of Morgan Stanley, said: “The plans’ most attractive feature is their ability to generate returns in a negative market and in this economic environment we think they will prove popular again.
“Not all investors share the same opinion as to how long to maintain a defensive strategy so we are offering a defined short term and the potential for a longer investment period to accommodate these views.
“The Eurozone crisis shows no sign of abating but investors are still seeking higher returns, so we believe these plans provide a sensible strategy to achieve that aim with palateable and understandable levels of risk.”