CompareStructuredProducts.com - 22/04/2020
Describing the decade’s inaugural quarter as a whirlwind may be something of an understatement…
The FTSE 100 Index started the year at a strong 7,604 following a post-election market rally – later dubbed ‘Boris Bounce’. The Index maintained its strong position throughout January with an average level of 7,558. Although it was during January that stories regarding the outbreak of the coronavirus began to surface with ever increasing frequency and concern. The outbreak was declared a Public Health Emergency of International Concern on 30th January, and the first COVID-19 cases in the UK were confirmed the following day.
Subsequently, coronavirus-induced panic started to fester worldwide causing major economic disruption. February witnessed the worst week for stock markets since the Global Financial Crisis; the FTSE 100 Index fell by almost 1,000 points in just one week, scraping levels not touched since the 2016 Brexit referendum hangover.
Throughout March investment markets around the world took a beating as the virus continued to claw its way around the globe, to devasting effect. With the world’s death toll growing exponentially, the WHO declared the outbreak a pandemic on 11th March. The FTSE 100 Index fell by 10.9% the following day, this being the worst single day since the ‘Black Monday’ crash of 1987. The average level of the FTSE 100 Index in March was just 5,741 – more than 1,900 points lower than its average in the quarter’s opening month. From start to finish the FTSE 100 Index fell by 24.8% in Q1, closing at 5,671. 1
Nonetheless, the retail structured product sector, on the whole, has performed relatively well. A total of 108 products matured between January and March providing investors with an average annualised return of 5.7% over an average term of approximately three and a half years.
Of the 108 maturities, 100 matured with a gain, predominantly in the early part of the quarter admittedly, five returned capital only and the remaining three plans three plans matured with a capital loss for investors.
The table below offers a more detailed breakdown, as well a comparison between the performance of Lowes ‘Preferred’ plans against ‘non-Preferred’ plans; a reminder, ‘Preferred’ plans are those that we believe to have the most attractive terms at the time of launch.
Q1 2020 maturity results. Source: CompareStructuredProducts.com
|All Products||Lowes 'Preferred'|