2020 Q2 Maturity Review
Blair Carmichael, Lowes Financial Management
Q2 signaled more optimistic market sentiment following a period where a certain R.E.M. track about the end of the world might have felt appropriate. Whilst most European indices remained at depressed levels due to all things Covid, in America, whilst the virus continues to wreak havoc, the markets have staged a significant recovery, with the S&P 500 returning to the index levels which we saw in Q4 of 2019 and the Nasdaq fully recovering and establishing new highs.
The FTSE 100 low point in the quarter occurred at the beginning of the period when on April 2nd the Index saw an intraday low of 5,395.07. Two months later, on June 5th we saw the Index hit its quarterly high of 6,489.99; a rise of more than 20%, measured from the trough to the peak.
In the first quarter of 2020 the UK retail structured product sector enjoyed 108 maturities with all but eight of these producing gains. However, the depressed market impacted upon Q2 maturities because most products issued within the preceding five years struck at higher index levels. It isn’t all bad news though, as the vast majority of products which failed to mature will have further opportunities to mature, with increased potential returns.
Q2 2020 maturity results. Source: StructuredProductReview.com
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