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RISK FACTORS |
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Is
this product right for me?
This Plan is designed for those customers who want
to benefit from the potential long-term growth of the Index and are
prepared to accept a degree of risk to their capital in return for
the prospect of enhanced returns. Before investing, however, it is
important that you are comfortable with the Plan and the risks that
exist in return for the potential rewards.
You should also be aware that if you do not hold this Plan for the
full term, you may not get back the amount you invested. In
addition, please note that as this investment is linked to a
stockmarket, it is different from depositing money in a Building
Society or Bank account, and access to your capital during the
investment term is restricted.
To help you decide if this Plan is right for you, below is a brief
list of pros and cons which you should consider before investing.
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Yes, I wish to invest because:
• I am willing to invest
for a set period of time, known as the investment term; (see
page 4 of the brochure)
• I am not likely to need access to my money during the
investment term; (see page 5)
• Capital Protected Option - The structure of the Plan means
that the Index will only have to rise by 13% to achieve the
maximum return of 65% (see page 4)
• Super Growth Option - The structure of the Plan means that
the Index will only have to rise by 13% to achieve the
maximum return of 65% (see page 4)
• I want the potential to benefit from any rise in the Index
but do not want to invest directly a stockmarket; (see page
4)
• I know that the value of the Index can fall as well as
rise; (see page 4 & 5)
• I understand that although the assets will be provided by
a major Investment Bank with a current credit rating from
Standard & Poor’s or equivalent rating agency of at least
‘AA-’, there is a chance that they may default on the
payments due and this means that I may lose some, or
all, of my investment, known as the counterparty risk; (see
pages 3 & 8)
• I am prepared and can afford to accept the
investment risks; (see page 4 & 8)
• I have asked my Financial Adviser to answer
any questions or queries I had. |
No, I don’t think I should invest because:
• I am not
prepared to accept any risk of loss to my capital; (see page
4 of the brochure)
• I may need access to my money before the end of the
investment term; (see page 5)
• I understand that I will not receive any growth above the
maximum return if the FTSE100 grows above 13% (Capital
Protected Option) or 20% (Super Growth Option); (see page 4)
• I understand that I will not receive any growth above the
maximum return even if the FTSE100 grows above 20%; (see
page 4)
• I want an income from my investment
• I don’t want to lose the dividend income that I may get if
I invest in shares or other similar investments
• I don’t want an investment where the returns are linked to
a stockmarket; (see page 4)
• I don’t fully understand how the Plan works;
(see page 3)
• I don’t have any other savings or investments; (see page
5) |
What are the risks involved with investing?
• The investment
return you receive will depend on the performance of the FTSE 100
and it is possible that you might not receive any investment return
at all. Please see the ‘How is my Capital Return calculated?’
section and table on page 4 of the brochure.
• Capital Protected Option - at maturity the investment return is
capped at 65% therefore, if the Index has grown by more than 13% you
will not receive the benefit of any growth over the predetermined
level stated. You will receive a full return of capital irrespective
of the performance of the FTSE 100.
• Super Growth Option - at maturity the investment return is capped
at 100% therefore, if the Index has grown by more than 20% you will
not receive the benefit of any growth over the predetermined level
stated.
• As the calculation of the investment proceeds will depend on the
Closing Level of the Index on the measurement date, as set out in
the ‘How are my returns calculated’ section on page 5, the Plan may
be affected by short-term market fluctuations.
• In respect of the Super Growth Option the capital return at
maturity will depend on the performance of the Index and it is
possible that you could lose some, or all, of the amount you invest.
The capital return will only be affected if the FTSE 100 has fallen
by 50% or more from its Opening Level at the close of business on
any day during the investment term and not recovered by the end of
the period. Please see the ‘How is my capital return calculated?’
section on page 4.
• If your circumstances change and you need to withdraw your
investment early we will have to sell your Securities back to the
Issuer and the value will depend on the price they are prepared to
pay. You will also have to pay an administration charge. You should
note that while the asset provider intends to make a secondary
market a material change in market or corporate conditions could
affect this.
• The Securities you purchase will be issued by a major financial
institution, which has a current credit rating of at least ‘AA-’
from Standard and Poor’s. If the financial institution were to fail
to meet the repayments due to you, you could lose some or all of
your investment.
• If you tell us that you want to cancel your investment after we
have bought the Securities you will only get back the value of the
Securities when we sell them, which is likely to be less than your
original investment.
• The values of any tax reliefs will depend on your individual
circumstances. You should note that the levels and bases of taxation
could change in the future. What are the risks of transferring my
ISA?
• Your existing ISA must be transferred in cash, which means that
your existing Plan Manager will sell your investment holdings.
• Your existing Plan Manager may charge you an exit or transfer fee.
There is the potential for loss of income or growth if markets
should rise while your transfer remains pending.
• Please note that to ensure your funds are received from your
existing Plan Manager in a timely manner, we will not normally
accept ISA transfer applications after 14th November 2008.
Please refer to the Brochure and the Terms & Conditions for full
details.
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