The Plan offers repayment of capital plus a refined return as long as the level of the FTSE 100 Index on the second anniversary, or subsequent anniversaries is equal to or above the starting level, taken on 9 October 2013.
Potential defined return payment:
End of Year
6 (9 October 2019)
FTSE 100 is unchanged or higher
Capital is not protected with this plan, so between 50 per cent and 100 per cent of the original investment will lost if the final level of the FTSE 100 has fallen by more than 50 per cent from the starting level at the end of the six-year term.
Jock Cassidy, director for Middlesex-based IFA Ashley Law, said: “This type of product has caused major problems for advisers in the past and before recommending this product, an IFA should pay close attention to the underlying risks.
“Further, I suspect many clients wishing to invest smaller amounts would not be prepared to pay the level of fees required by an IFA to carry out thorough research and suitability reports.”