04/09/2024 

August recorded 73 structured product maturities, another impressive monthly total but unsurprising considering the FTSE 100 recorded a monthly average of 8,253.97. With over 72% of the maturities being FTSE 100 (or CSDI) linked, conditions were ideal for maturing autocalls. Just five autocalls last month matured on their final observation date, the rest all kicking out early due to elevated stock market levels. One of the month’s maturities was a fixed term contract that was always due to mature last month.

The average annualised returns for capital at risk autocalls was 7.18% over and average duration of 2.63 years, FTSE* only autocalls outperformed the sector by 0.65%, realising 7.83% over an average term of 2.58 years. No deposit based contracts saw a maturity last month.

Looking at some highlighted maturities of last month:

Provider Product name Index link Maximum term (years) Potential return Counterparty Index movement % Final gain % Annualised return
Tempo Structured Products FTSE 100 FDEW Long Growth Accelerator Plan August 2019 - Option 1 FTSE 100 FDEW 10 80% after 5 years if index above strike or potential for 120% (capped) measured from 70% of strike after 10 years Société Générale 3.55 80 12.46%
Mariana FTSE 150 Kick Out Plan August 2020 FTSE 150 EWDR 10 15% per year held Natixis 12.58 60 12.46%
Walker Crips UK & US Kick-out Plan (MS135) FTSE 100 & S&P 500  6 12% per year held Morgan Stanley & Co. International 5.87
15.82		 12 11.93%
Tempo Structured Products FTSE 100 FDEW Long Kick-Out Plan August 2019 - Option 3 FTSE 100 FDEW 10 14.7% per year held Société Générale 3.55 73.5 11.64%
Mariana 10:10 Plan August 2022 (Option 3) FTSE CSDI 10 12.25% per year held Morgan Stanley & Co. International 7.35 24.5 11.56%
MB Structured Investments UK Kick Out Plan (Y2 65) August 2022 FTSE 100  5 10% per year held Barclays 11.21 20 9.53%
Goldman Sachs FTSE 100 Defensive Kick Out Plan August 2022 FTSE 100  7 8.3% per year held Goldman Sachs 7.64 16.6 7.97%

 

In all but one of the cases of the above we see that the final gain outperformed the index movements.

With the FTSE slightly below all-time highs, at these levels we expect that September will see another month of ample maturities. The current range of products available to investors’ is such that there are plans to meet all different risk/return appetites, yet the fact of the matter is that, especially for autocall products, the built in end of term capital protection barriers should be sufficient to protect investors’ from loss in all but extreme circumstances. Common sense should prevail – a well diversified overall portfolio and sensible counterparty exposure are key for success in structured products.

To see currently available plans on offer from the providers above please visit our current products page here.

Sources: StructuredProductReview.com, Investing.com

*FTSE incorporates plans linked soley to the FTSE 100 or its very close, 99%+ correlated 'cousin' the FTSE CSDI, which tracks the same 100 stocks with the same weightings but accounts for dividends differently.

 

Structured investments put capital at risk.

Past performance is not indicative of future results.