Question: Would the panel suggest a ‘Structured Deposit' as a safe way of investing?
Ian Lowe - Lowes Finacial
A structured deposit usually involves forgoing the interest that would otherwise be earned on deposit monies, in return for interest calculated by reference to some other measure, such as the performance of the FTSE 100 index. There is of course the risk that a Structured Deposit ultimately produces less interest than an ordinary deposit account, but the capital should be no more, or less secure. As with any deposit, the return of capital is dependant upon the deposit taker's solvency however, as UK deposits are covered by the Financial Services Compensation Scheme then an investment of up to £50,000 with any one institution could indeed, in my opinion, be said to be safe. Obviously, advisers need to consider the fixed term nature of a structured deposit when assessing suitability; however this would equally be the case when considering any fixed term deposit offering.
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