Beware structured products and hedge funds

“Smart products, dumb choices”

There are lots of adverts trying to tempt investors towards ‘principal protected, stock market participation’ or structured products and hedge funds. These investment vehicles may look appealing and relatively simple but both can expose you to risk. Our latest white paper looks at these two sophisticated and complex investment products in more detail.

A cautionary tale of the costly seduction of investors

Structured products appear simple at first glance, but are far more complex when one looks under the bonnet.

Hedge funds have a certain mystique, allure and seeming sophistication that has acted as a siren to many yet in general fail to deliver their promise of skill-based returns.

Tread with care

Both expose investors to unknown, unconsidered or opaque risks with considerable performance and risk management challenges.

Both sit uneasily in well structured, evidence-based traditional portfolios. The fact that they are widely used, dose not make them good portfolio building blocks. Nor does it absolve advisers or their clients from deep due diligence, in the unlikely circumstances that they are deemed to assist in meeting long-term investors’ needs.

The conclusion? Structured products and hedge funds are smart products but dumb choices.

Please call or email us if you would like a copy of this white paper in full. 01582 461122 or balance@nullbphwealth.co.uk