Frequently Asked Questions

This section aims to provide brief answers to some of the most commonly asked questions about structured products. If you require further information – or need to discuss any other subject related to structured products - please call us on 0800 234 6023.

What is a structured product?
How does capital protection work?
Who are structured products for?
How long do I have to invest my capital for?
Can I withdraw my money during the investment period?
Is my capital safe with the company underwriting the product?
How much do structured products charge?
Am I entitled to dividend payments from the underlying index?
How often are products available?
How can I see how my investment is progressing?
How are products taxed?
Can I use structured products in my pension?

What is a structured product?

A structured product is a fixed-term investment which offers capital growth or income with the benefit of full or partial capital protection.

Products are often linked to indices such as the FTSE 100 and offer returns based on their performance. The capital protection feature seeks to preserve investors’ original investment in the event of the market falling. Individual products do this to varying degrees.

How does the capital protection work?

Our products carry either full capital protection - which means that at the end of the investment period your capital will be returned in full, irrespective of the performance of the underlying index or asset – or “soft” protection, where we cushion any risk to capital within defined limits for each product.

Who are structured products for?

Structured products can be used by all types of investor. Typically, however, they appeal to those who want to gain exposure to stock market performance or achieve an attractive return without taking the risks associated with investing in shares or funds.

They are perhaps best viewed as the “middle way” between cash on deposit and unprotected equities.

How long do I have to invest my capital for?

Products typically have investment terms of three to six years. At the end of the term the products “mature” and, according to the performance of the index (or asset), pay back investors’ original capital and deliver the stated return.

Some products have early maturity features which offer investors the stated return and their original capital should the index match its starting level at one or more pre-determined points over the life of the investment.

Can I withdraw my money during the investment period?

Yes. Our plans offer two “windows” every month during which investors can withdraw their capital. However, by exiting before the end of the product term investors may receive less than they originally invested, and the capital protection feature will not apply.

Is my capital safe with the company underwriting the product?

All our products are backed by our parent company Barclays Bank. Barclays is deemed to be financially strong and is AA- rated by Standard & Poor’s.

How much do structured products charge?

Our plans typically charge around 1% per annum, which is inclusive of fees and commission. The charge is taken from the original investment at the outset of the plan – there are no other charges to pay.

Am I entitled to dividend payments from the underlying index?

No, our products link only to the capital value of the relevant index. However, the value of dividends has declined in recent years as companies reduce or cut completely their payouts to shareholders. Dividends are also taxed, which further lessens their value.

How often are products available?

Our products are usually open for investment for eight weeks at a time. When one product closes to new investment we immediately launch a replacement product which is, in most cases, identical, other than the start/end date and the investment return. The investment returns we offer vary in line with market conditions.

How can I see how my investment is progressing?

We send valuation statements to investors twice a year so they can see how much their investment is currently worth. We also produce a “Snapshot” valuation summary every six months to show investors what they could receive at maturity given market/asset class levels at the statement date.

How are products taxed?

With the exception of our Regular Income Bond, our products' returns are treated as capital gains rather than income for tax purposes. This means you can use your Capital Gains Tax annual exemption to reduce or eliminate completely the tax charge on any returns.

The majority of our products are also available within an ISA.