Dual Index Defensive Income Kick Out Plan November 2018

Mariana Capital

Dual Index Defensive Income Kick Out Plan November 2018

The Mariana FTSE S&P Range Income Plan is a ten years and two week plan based on the performance of the FTSE 100 and S&P 500.

  • Potential return: 1.8 % per quarter
  • Product type: Capital at Risk
  • Investment type: Income
  • Closing Date: 6 November 2018
  • ISA Transfer: 17 October 2018
  • Start Date: 9 November 2018
  • Maturity Date: 9 November 2028
  • Market / index link: FTSE 100 Index and S&P 500 Index
  • Counterparty: Morgan Stanley
  • Investment term: 10 years two weeks (maximum)
  • Kick-out / Early maturity: Yes
  • Barrier type: End of Term
  • Barrier level: 60%
Important: The closing date for applications by cheque is 26 October 2018 and by bank transfer is 3 November 2018.

Product Literature & Forms

You should always read the relevant plan brochure and any other plan documentation, for full details of the plan’s features, including any risks, and the terms and conditions. In addition to the plan brochure and terms and conditions there are other important documents, including a Key Information Document ('KID'), that you should consider, before deciding to invest in the plan.

If you do not fully understand the risks or are unsure as to the suitability of the investment, please contact us

Complete the form and we will email you the requested literature and instructions on how to invest.

Select the application form you require

How to Invest?

1 Call for a free initial telephone consultation. If you wish to progress the process of the product purchase, the regulatory process of ‘advice’ must commence.

2 The completion of a financial review – which will confirm details of your income/capital and investment needs and experience

3 The completion of a risk profiler - which will help to measure your attitude to risk.

This process will enable ‘advice’ to be provided in relation to the suitability of the product to meet with your needs. The fee for this service and process is 1.5% (subject to a minimum fee of £300) for focused advice – which is focused and narrowed to the suitability of the structured product you want to purchase.

Further Information

The Dual Index Defensive Income Kick Out Plan November 2018 is a ten years and two week Plan based on the performance of the FTSE 100 Index and S&P 500 Index, the Underlyings.

The Plan is constructed to offer a Potential Income of % per quarter providing the Closing Price of both the Underlyings is at or above 75% of the Start Level on each quarterly Observation Date. If the Closing Price of any one of the Underlyings is below 75% of the Start Level on a quarterly Observation Date, no income is paid for that quarter.

The Plan has the possibility to kick out from the end of year 2 and quarterly thereafter. Should the Closing Price of both the Underlyings be at or above 105% of the Start Level on any one of the kick out Observation Dates, the Plan will mature early paying the Potential Income for that quarter and returning Initial Capital in full (subject to Counterparty Risk).

If the Plan has not already kicked out, Initial Capital will be returned in full at the end of the Plan’s term if on the Maturity Date the Finish Level of the worst performing Underlying is not more than 40% below the Start Level.

Therefore, This Plan has been designed for clients who are looking for a high level of income over a 10 year and two week period, where the level of income is known and can be budgeted for, perhaps to meet living expenses.

It is aimed at clients who may be cash rich but income poor. As the capital is at risk, it is suited to those clients who are willing to take a risk on capital return in order to receive a higher level of income than could otherwise be achieved from cash products, and therefore are likely to have a medium attitude to risk or higher.

Don’t forget the risks

All investments carry risk. It is identifying those risks, understanding how they may affect an investment and assessing whether an investment is suitable for your circumstances that is important.

The potential returns of most structured products and repaying the money invested are usually linked to the level of a stock market index and also depend on the financial stability of the issuer and counterparty bank. You should only consider investing if you understand and accept the risk of losing some or all of any money invested.

You should always read the relevant plan brochure and any other plan documentation, for full details of a plan’s features, including any risks, and the terms and conditions. In addition to the plan brochure and terms and conditions there are other important documents, including a Key Information Document (‘KID’), that you should consider, before deciding to invest in a plan.

Structured products should only be considered as part of a diversified and balanced portfolio.

Below is a summary of some of the main risks usually associated with an investment in structured products plans:

Market risk to potential returns

Whether or not a plan generates the potential returns for investors usually depends on the closing level of the relevant index on the relevant dates for the plan, i.e. the kick-out anniversary dates for kick-out products; the early maturity dates and end dates for growth products; the annual income dates for income products.

If the index closes below the level needed, for the plan or plan options chosen, on all of the relevant dates, the plan or plan options will not generate a return.

Market risk to repayment of money invested in 'Capital-at-Risk' plans

If the closing level of the relevant index is below the level needed on all of the kick-out anniversary dates or early maturity dates, if relevant for the plan or plan options chosen, and on the end date, repaying the money invested at maturity will usually depend on the closing level of the index on the end date..

Different structured products use different types of protection barriers. Some products use barriers that are observed every day that can therefore be breached on any day during the investment term, while some products use barriers that are only observed at the end of the investment term and that cannot therefore be breached during the investment term.

Market risk to the repayment of money invested on the end date will depend on the type of barrier and its level.

For example, for a product with an end of term barrier, set at 60% of the start level, if the index for the plan closes at or above 60% of the start level, on the end date, money invested will be repaid in full (less any agreed adviser fees and withdrawals). However, if on the end date the index closes below 60% of the start level, the amount of money repaid (less any agreed adviser fees and withdrawals) will be reduced by the amount that the index has fallen. For example, if the index has fallen by 45%, the repayment of money invested will be reduced by 45% (meaning that investors will get 55% of their investment back).

'Protected' types of structured products

Some structured product plans are designed so that they are 100% protected from stock market risk at the end date.

It is important to understand that even if a structured product plan is designed with 100% protection from stock market risk, at the end date, it will still usually have issuer and counterparty bank risk. In other words, both the potential returns of the plan and repaying the money invested at the end date will depend on the financial stability of the issuer and counterparty bank. If the issuer and counterparty bank become insolvent, or similar, or fail to be able to meet their obligations, it is likely that investors will receive back less than they invested.

Issuer and counterparty bank risk

Both the potential returns and repaying the money invested of most structured products depend on the financial stability of the issuer and counterparty bank. If the issuer and counterparty bank become insolvent, or similar, or fail to be able to meet their obligations, it is likely that investors will receive back less than they invested.

Financial Services Compensation Scheme ('FSCS') protection

It is important to understand that it is not usually possible to claim under the Financial Services Compensation Scheme if the issuer and counterparty bank fail to meet their obligations or if the stock market index that a plan links to falls.

Structured deposits

Structured deposit plans are deposit-based and will usually be fully protected from stock market risk at the end date and also benefit from the protection of the Financial Services Compensation Scheme, if the bank or building society is a licensed UK deposit taker.