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Structured Notes
This page provides an overview of the structured notes currently available through NEBA for financial advisers, wealth managers and discretionary fund managers. Each note includes key information such as the underlying, coupon, barrier levels, term, ISIN and factsheet, giving advisers the essential details needed to assess each structure.
Structured notes can serve a defined role within a client portfolio, providing returns linked to an underlying market subject to predetermined conditions. They are not a replacement for a diversified investment strategy, and their suitability depends on each client’s individual circumstances. The sections below explain how structured notes work, the key risks to consider and how NEBA supports advisers in assessing their suitability.
What are structured notes?
A structured note is a debt instrument issued by a financial institution, with its returns linked to the performance of an underlying asset such as an equity index, basket of shares or other reference asset.
Unlike a conventional fixed-income investment, the return on a structured note is generally conditional on the performance of the underlying relative to specified levels or barriers over a defined term. Common features may include income coupons, autocall triggers that can result in early maturity, and barriers that determine how capital is treated at maturity.
Because the payoff is defined in advance, advisers can assess how a structure may perform under different market scenarios before considering it for a client. The characteristics of each note vary, and the appropriate structure will depend on the client’s objectives, risk profile and wider portfolio.
Key risks advisers should assess
- Market and underlying risk: Returns and capital repayment depend on the performance of the underlying relative to the terms and barriers of the note.
- Issuer credit risk: A structured note is an obligation of the issuing institution. If the issuer defaults or becomes unable to meet its obligations, investors may lose some or all of their investment regardless of the underlying’s performance.
- Liquidity risk: notes are designed to be held to maturity and secondary market pricing can be limited.
- Complexity and suitability: payoff structures vary widely, so the note must match the client’s objectives, risk tolerance and capacity for loss.
Assessing suitability for your clients
A structured note is suitable only where it fits the client’s wider portfolio, objectives and attitude to risk. The detail provided for each note is intended to support that assessment rather than replace it. Where a note forms part of a portfolio, it is generally most effective alongside a broader investment strategy rather than in place of one.
How NEBA supports advisers
NEBA works with financial advisers, wealth managers and DFMs to access and assess structured notes in context. We can provide current factsheets, explain how a given structure behaves across market scenarios, and help you frame the note within a client’s overall plan. To request a factsheet or discuss suitability for a specific client, contact the NEBA team.
Common questions
What is an autocall note? An autocall note can mature early if the underlying is at or above a defined level on an observation date, returning capital plus any due coupon before the full term.
Are structured notes capital protected? Not necessarily. Some notes offer conditional protection through a barrier, while others place more capital at risk. Each note’s terms set out exactly how capital is treated, so always check the factsheet.
How do worst-of structures work? A worst-of note links its outcome to the weakest performer in a basket of underlyings, which can raise the coupon but also increases risk, since the least favourable asset drives the result.
Important information
Capital is at risk. Structured notes are complex instruments and are not suitable for all investors. Returns and the return of capital are conditional and depend on both the performance of the underlying and the financial standing of the issuer. This page is intended for professional advisers and is for information only. It does not constitute investment advice or a personal recommendation, and advisers remain responsible for assessing the suitability of any note for their clients. Past performance is not a guide to future results.