Investments  

Platforms to offer structured products

This article is part of
Structured products - January 2013

Access to structured products had been limited on some of the independent wraps and not all platforms have made them available to investors.

Where they have been available, the investment information available is usually very basic and adds little value for the client or their adviser.

However, with structured products appearing on many more advisers’ radars, this situation is set to change rapidly.

Currently, investors looking to generate investment returns are faced with an environment where stockmarkets are generally tracking sideways and interest rates remain at all-time lows. With the US, Europe and other economic blocks continuing to struggle with recessions following the global financial crisis, it is likely this situation will continue for a while.

In this ongoing scenario, investors are looking for investments that can achieve attractive returns in spite of the current market constraints and can diversify risk and protect capital against the threat of downturns. These choices will almost certainly include structured products.

Just a few years ago advisers were buying mutual funds direct from the fund houses. Few advisers would think of investing all clients’ funds like that today, but the same ease of access can now be achieved for structured products.

Extending the ability to hold, purchase and monitor structured products on a platform will help level the playing field between mutual funds and structured products and, with empirical evidence indicating growing interest in structured products among financial advisers, this can only see the structured products market grow sizably in the next few years, benefiting advisers and investors.

Mark James is head of distribution at SPwrap.com