FTSE 100 Step Down Kick Out Plan - Morgan Stanley option
A maximum six year structured investment plan linked to the performance of the FTSE 100 Index. The Plan can mature at the end of years 2, 3, 4, 5 or 6 with a fixed payment equal to 6.55% per annum, if the FTSE 100 is above a reducing percentage of its starting levels.
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
How to Invest?
Please note: This plan is available on an advised basis only. If you are interested in this plan, please telephone us on to arrange a free consultation
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.
The Plan is designed to repay your initial investment and deliver a return dependent on the performance of the FTSE 100.
Potential for maturity at the end of years 2, 3, 4, 5 or 6 with a payment equal to 6.55% per annum (not compounded) if the five-day average closing level of the FTSE 100 is higher than a specified percentage of the Initial Index Level. The specified levels are 100% of the Initial Index Level in year 2 and reduces by 5% per annum to 80% in year 6.
The Reference Levels are as follows: year 2 at 100%; year 3 at 95%; year 4 at 90%; year 5 at 85% and year 6 (Final Level) at 80%
If the Plan continues to the end of year 6, the closing levels of the FTSE 100 are used to calculate the Final Index Level, as explained below:
- If the Final Index Level is higher than 80% of the Initial Index Level, you will receive back your initial investment plus 39.3%.
- If the Plan runs for the full 6 years and the Final Index Level is equal to or lower than 80% of the Initial Index Level but is equal to or higher than 60% of the Initial Index Level, you will receive back your initial investment with no return.
- If the Final Index Level is equal to or lower than 80% of the Initial Index Level and the FTSE 100 has fallen by more than 60% from the Initial Index Level during the Observation Period, then your initial investment will be reduced by 1% for every 1% fall (including partial percentages) in the FTSE 100.
This Plan has been designed for clients who are looking for equity-linked returns over a 6 year period, but can accommodate receiving their money back before the end of the term. The payoff profile has been designed to suit clients who are cautious on equity market growth. Clients are likely to have a medium to high attitude to risk and be prepared to risk their capital in order to potentially achieve higher returns. This product is aimed at a more market cautious client who has high financial sophistication.
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: