A guaranteed winner is never a sure thing when it comes to investing, but sometimes certain products seem close to the mark.
Principal protected notes (otherwise known as PPN’s) are a specialized group of funds that are built to ensure guaranteed returns on levels that the average investment product cannot.
Bank accounts that are guarded by deposit insurance are not the same as PPN’s”, explains Richard Meyer Cayne of Meyer International in Bangkok, Thailand. “PPN’s are highly structured investments that come attached with specific protections, although it’s worth bearing in mind that even with a PPN, there is no guarantee that you will see a full return on your investment”.
Principal Protected Notes Seem Simple
PPN’s are actually quite simple
Generally after maturity, specific triggers that have been structured into place will allow investors to receive at least the equivalent of their initial investment.
For example, let’s say that a PPN is connected to the FTSE100 and that it comes with full protection and matures at the 10 year mark. After the 10 year maturing process, let’s presuppose that the FTSE100 drops 10% in value; the investor while still receive a return equal to their initial investment.
But, if the FTSE100 should see a 10% increase in gains, said investor will receive not only their initial investment, but also an additional 8%. The fee for principal protection is where the other 2% goes.
Principal Protected Notes are Complex at Their Heart
Obviously, this is a very simplistic example given.
PPN terms can oftentimes be intricate and complex.
Just a few of the questions one has to keep in mind when considering PPN’s are how much will the protection cost? When does the protection kick in? What is the return or principal being protected in the first place? What are the benchmarks? What is the note linked to? Many considerations have to be taken into account.
While the complexities of PPN’s may seem intimidating at times because those that issue them want to guarantee they will receive some monetary compensation out of the deal, this does not necessarily mean that every PPN should be avoided.
Principal Protected Notes are not for Everyone
With the complexities of PPN’s, one also needs to be aware of the fact that access to PPN’s is oftentimes limited.
Many issuers will only make them available through private banks or through custodial accounts because of the type of principal protection.
PPN’s are not generally available on the open market.
Utilizing institutional accounts, investment experts can gain access to PPN’s that would otherwise be unavailable to individual investors”, says Richard Meyer Cayne of Meyer International.
“It’s important that you consult with a trusted financial expert to ensure that you will receive the protection that’s right for you with the highest possible return”.
Richard Meyer Cayne
Richard Meyer Cayne of Asia Wealth Group Holdings, the Meyer Group, Meyer Asset Management and Meyer International Ltd has been involved in wealth management planning for decades. Originally born in Montreal Quebec, Canada, he later relocated to Tokyo, Japan for over 15 years and now resides in Bangkok, Thailand. While he runs the Meyer Group and serves as the high credibility CEO of Asia Wealth Group Holdings Ltd, a London, UK Stock Exchange-listed Financial Holdings Company, as well as the Managing Director of the Meyer Group of Companies www.meyerjapan.com. and has additionally been the managing director of multiple organizations that specialize in helping high net worth individuals with succession planning .
Having worked with clients all over the globe with everything from portfolios to bonds to mutual funds to offshore investing to investing in retirement for your golden years, Richard Cayne of Meyer International can help you invest the right way and protect your cash. Richard has been a financial advisor involved in wealth management planning solutions and asset management in Asia for over 25 years and while living in Tokyo, Japan, he assisted many high net-worth Japanese families create innovative international tax and wealth management planning solutions. The financial holding public company of which he is CEO can be seen at Asia Wealth Group Holdings Ltd or the stock exchange link:
https://www.aquis.eu/aquis-stock-exchange/member?securityidaqse=AWLP
Asia Wealth Group Holdings Ltd – Richard Cayne Thailand. Meyer Asset Management Ltd has been in the wealth management space since March 2000 and uses fundamental analysis along with modern portfolio theory.
His image worldwide as a professional advisor has been sterling and he maintains a firm command and understanding of all things finance-related.
