Custodian and plan administrator Reyker Securities is selling structured products to retail clients through professional advisers.
"We have been told not to provide any information on these products," a Reyker associate told SRP, asking for any queries to be directed to the firm's structured products team.
SRP accessed the product literature for what seems to be the first of Reyker's offering in the UK structured products market, although the firm is not disclosing any information about its structured products plans at the moment. The product brochure is accompanied by back-testing and investment consideration files.
According to an email sent to financial advisers seen by SRP, Reyker said that recent changes in the structured product industry have offered the firm a unique opportunity to leverage on its expanded capability and regulatory permissions. "We will start to bring out new structured investments plans for advisers," it said. "These plans are designed, promoted and administered by Reyker - all under one roof with no outsourcing to other parties."
The Diversified Dual Index Kick-Out Plan - Defensive Series 1 is a six-year capital-at-risk knockout product linked to the FTSE100 and the Eurostoxx50 indices. The product offers a choice of counterparties and will pay 7.6% per annum for the Royal Bank of Canada-hedged version or 9.85% per annum for the structure using Morgan Stanley as counterparty, from the second anniversary onwards if the underlying is above 90% of its strike value. The product also offers a 50/50 version combining the two counterparties and will pay 8.725% per annum after the second yearly observation date.
The two versions feature a 60% downside protection barrier and the product literature states that adviser charging can be facilitated. The offer period closes on 5 March and the minimum investment is £5,000.
Reyker became prominent in the UK structured retail products market following the disappearance of Merchant Capital and Incapital and currently provides indicative trading prices from the respective counterparty on a number of products from them.