Structured Products are generally no riskier than other financial instruments available in the market. Read on to find out how we dispel the common misconceptions about Structured Products.
MYTH: Structured Products are investments connected to highly volatile underlying.
FACT: The underlying assets in Structured Products are usually commodities, equities, indices, forex, or funds. As such, Structured Products can be created with a variety of different asset combinations suited to each individuals varying risk appetite.
For example, indices have lower volatility as compared to commodities and equities and forex. Their much lower volatility and diversified holdings generally make them suitable for long terms investor who are risk-averse.
MYTH: Lower returns with Structured Products as compared to traditional investments.
FACT: Although there is some truth with Structured Products providing less returns compared to a 200% VTD growth stock like Amazon or a 10% Annualised S&P index or a top performing hedge fund that produces 20% PA. on average; Structured Products come with a host of key features like Protection Barrier.
Coupon Trigger and Memory Feature (depending on type of structure) to greatly reduce risk exposures, especially for the risk-averse investors who are not comfortable with such open.ended investments
MYTH: Institution underwriting of the Note is unreliable /concerns on 3rd party liabilities.
FACT: Nowadays, it is common to come across dubious investment products that seem like scams or are issued by unregulated, unsafe, or unknown investment entities. Due to such concerns. investors shun structured products altogether.
This is a very relatable experience. Hence, to create a safer yet flexible investment option, NEBA takes pride in ensuring that your investments are well protected by providing products that are issued only with Banks that are heavily regulated and have a minimum credit of B+ rating (Commerzbank – A-. EFG – A) from agencies such as Moody’s. Fitch etc, unless otherwise requested.
