The Ethical Offshore Investments

Structured Note Portfolio

With the increase in demand from investors for Structured Note type investments, we have decided to promote a Structured Note holding portfolio, with NO entry or establishment charges, and NO ongoing financial adviser charges.

Plus, investors through Ethical Offshore will continue to receive a minimum of 1% of the invested amount, rebated back to them.

So what is a Structured Note..??

A structured note is a hybrid investment product, issued by a financial institution, that combines a debt security (like a bond) with a derivative component to offer a return linked to an underlying asset, index, or commodity. It aims to provide investors with market-linked growth potential and varying levels of downside protection or principal safety, though this often involves capping potential upside returns.

Key Features of Structured Notes

• Hybrid Structure: They merge a bond component, which can offer principal protection, with a derivative component, such as options, to provide exposure to various asset classes. 

• Underlying Assets: The note’s performance is tied to a reference asset, which could be a single stock, a basket of equities, an equity index (like the S&P 500), a commodity, or even interest rates. 

• Principal Protection: Many structured notes are designed to protect the investor’s principal, either fully or partially, by incorporating a debt component with a safety buffer or “barrier”. 

• Issuer Risk: As they are debt securities, the creditworthiness of the issuing financial institution is a critical risk factor for investors. 

• Complexity and Customization: Structured notes are complex products with features and payoffs that can be tailored to specific investment objectives. 

How They Work (Simplified)

• Issuer’s Promise: A bank or financial institution issues the note, promising a return that is determined by a formula based on the performance of an underlying asset. 

• The Bond Component: A portion of the investment is used to purchase a bond, which provides safety and potentially principal protection at maturity. 

• The Derivative Component: The rest of the investment is used to buy a derivative, such as options, to provide the upside potential linked to the underlying asset. 

• The Payoff: At maturity, the investor receives their principal and interest payments based on the performance of the underlying asset and the terms of the structured note. 

The above is the result of an AI Google Search on What is a Structured Note, and in all honesty, I don’t think I could have worded it any better……….

How does this all come together…??

Investors will establish a Platform holding account with the Ardan International Platform that is domiciled and regulated in the Isle of Man (in some situations due to the investors nationality, residence country & tax situation, an Offshore Life Portfolio Bond policy may be used). This will be the holding structure for the various Structured Note investments that the investor chooses to invest in.

There will be NO entry or establishment fee applicable for deposits made into the Ardan International Platform that will be used to invest in Structured Notes, and in fact, investors that use Ethical Offshore will get a minimum of 1% commission rebate added to their Structured Note investments.

Click for Information on the Ardan International Platform

In addition to this, we will not be charging an ongoing portfolio client management fee for the Structured Note holding portfolios. 

So, if we are not charging, how do we as a firm make money on this…..?

Structured Note issuers generally will pay a commission (or sometimes called a marketing allowance) to firms for the placing of their Structured Notes. We as a firm have an internal policy where we will share this commission we receive with the investor, and at least 1% of the invested amount is rebated back to the investor.

Example, a client invests $10,000 in a Structured Note, we will instruct the Note issuer to issue 10,000 units of the note at 0.99 (instead of the standard $1.00 issue price) which will result in the client investing a net amount of $9,900 for a $10,000 holding.

What type of Structured Notes are available

We have a wide range of Notes available, with the option of receiving a regular income (monthly, quarterly or semi-annually) or capital growth style notes. The underlying investments of the Notes will be either a mix of major indices, such as the Euro Stoxx 50, or the S&P 500…. or it will be a mix of (generally) blue chip global companies.

All of the Notes that we have available will have some form of capital protection feature, which can provide peace of mind during downward market periods. There are Notes available that have a full 100% Capital Protection feature, so even in the situation where an underlying asset was to considerably drop in value, or even fully collapse to zero, the Note would still preserve the investors capital and 100% of the invested amount would be returned.  

Click here to see what Notes are currently available

We believe that this is a great, cost effective opportunity to invest in the diverse world of Structured Note products, where you can select the type of Structured Note(s) that meet your investment objectives, risk category and timeframe.

Speak with Ethical Offshore to see how easy it is to establish the holding Platform for your Structured Note investments……. And remember, there will be no set up or establishment costs for our Structured Note platform portfolios.

Risks to Consider

• Issuer Credit Risk: The note’s repayment depends on the financial health of the issuer. For this reason, we will only use financial institutions that carry a financial rating of at least Investment Grade from Standard & Poors (S&P), Fitch or Moodys. Examples of the Institutions that we use include Barclays, BBVA Global Markets, BNP Paribas, Canadian Imperial Ban of Commerce, Goldman Sachs, Morgan Stanley, Societe Generale and UBS.

• Complexity: The terms and features can be difficult to understand. 

• Potential for Lower Returns: To provide principal protection, the potential upside on the underlying asset is often capped. 

• Lack of Liquidity: Structured notes are not typically traded on public exchanges and may not be easily sold before maturity. However, the issuers of the Notes that we get exposure to, do have the flexibility to sell the Note holding prior to the maturity date, at the current market price (this may be lower or higher than the issue price).

At Ethical Offshore Investments, we are determined to show how clients can invest in a range of different investment structures and opportunities, but in a cost effective manner. The Structured Note portfolio is an example of that with there be no entry or establishment charges, as well as no ongoing client portfolio management charge (there will be an Ardan platform admin fee which is currently 0.40%pa (current max fee).

Our policy is that we will also rebate a minimum of 1% of the invested amount back to client, from the commission payment that we would receive from the Note providers

If you would like to learn more on how you can invest in a portfolio of Structured Note assets, please click on the More Information button below and our senior consultant will contact you personally.

Ethical Offshore Investments also provides guidance on portfolios that have an ESG (Environmental & Social Governance) bias and an SRI (Socially Responsible Investing) focus. By avoiding high charging, commission paying funds, this results in lower portfolio costs, so more of the growth staying in the pockets of our clients.