Investment Philosophy

In simple terms, structured deposits are a combination of traditional savings accounts and a stock market investment. The deposit is guaranteed to be returned in full on maturity and therefore it is only the interest that is at risk. Typically, interest depends on an index, stock or commodity. Due to the cost of the guarantee, investors will not receive the full benefit of the return, investors will not receive dividends and calculating the interest is likely to be confusing. For these reasons, they are deemed to be a complex product and as such, structured deposits are unlikely to be suitable for the majority of our clients. To date, history has proven us to be 100% correct in that judgement. STRUCTURED DEPOSITS INDEPENDENT FINANCIAL ADVISERS Clients with extensive investment experience and knowledge of complex instruments are better able to understand and evaluate the risk and potential rewards of unusual, complex and/or illiquid invest- ments such as NMPIs, ETFs and Investment Trusts. At Invest Southwest we recognise that experience and knowledge isn’t necessarily dependent on wealth and take each case on its merits. However, we have identified that in order to bring complex instruments into a discussion, it is likely the clients will have an annual income of more than £150,000 and/or have investable net assets of more than £500,000. These criteria are subject to review. SOPHISTICATED HIGH NETWORTH INVESTORS The FCA’s view is that these investments are unlikely to be suitable for ‘ordinary’ retail investors described as ‘retail clients who are neither sophisticated investors nor high net worth individuals’. These are the investors of more ordinary means and experience, who make up the vast majority of Invest Southwest’s client profile. We believe that such investors face difficulty understanding the terms and features of complex financial products and are at particular risk in relation to inappropriate promotion of non-mainstream pooled investments. With this in mind such products will not be promoted or recommended by Invest Southwest at present, but could be in future. Our advisers are aware of how they work and can refer any specific requests or circumstances where they think they could be relevant to the Compliance Manager or Managing Director.

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