Structured Products
The Structured Products Association says that structured products are "the fastest growing investment class in the U.S.," on pace for its first $100 billion year in 2007.
Structured products, offered by major financial firms, are securities created to deliver a specific risk-reward scenario. A hypothetical arrangement would give the investor twice the return of the S&P 500, capped at 12%, while the investor's principal would be protected against loss at maturity, which might be three years or longer.
Some structured products are more complicated. Investors can get structured products for as little as $5,000, or $2,000 for IRAs.
It should be noted that some structured products generate income tax in years when no cash has been received, so they probably work best in a tax-deferred account.
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Structured products, offered by major financial firms, are securities created to deliver a specific risk-reward scenario. A hypothetical arrangement would give the investor twice the return of the S&P 500, capped at 12%, while the investor's principal would be protected against loss at maturity, which might be three years or longer.
Some structured products are more complicated. Investors can get structured products for as little as $5,000, or $2,000 for IRAs.
It should be noted that some structured products generate income tax in years when no cash has been received, so they probably work best in a tax-deferred account.
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posted by Bob Moser at
7:31 PM
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