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Eight out of 10 for Gilliat

Gilliat Financial Solutions – Kick Out Growth Series Issue One

Type: Capital-protected bond

Aim: Growth linked to the performance of the FTSE 100 index

Minimum-maximum investment:

Term: Five years and 14 days

Return: 9% of the original capital in year one provided index is at or above its initial value, 16% at the end of year two, 21% at the end of year three, 24% at the end of year four, 25% at the end of year five

Guarantee: Original capital returned in full provided the index does not fall by more than 50% during the term without returning to at least its initial value

Closing date: December 24, 2009

Commission: Initial 3%

Tel: 020 7012 2809

This structured product from Gilliat Financial Solutions is linked to the FTSE 100 index for a term of five years and 14 days. However, it could mature earlier to provide a defined level of return, depending upon the performance of the index.

Price Bailey Private Client partner James King thinks the literature is very clear in explaining the risks and the potential growth available from the product. He says: “Gilliat has produced some of the best literature I have seen from a structured product provider.”

Turning to the potential drawbacks of the product King says: “The growth falls away at years four and five.” He also points out that the nature of the capital protection, where index performance is observed every day during the term, exposes investors’ capital to a little more risk than some products. Some structured products use the index performance only on the final day of the term as the final index level, so it does not matter if the index breaches a capital protection barrier during the investment term.

Looking at the potential competitors for the plan, King suggests Barclays Wealth and Meteor.

Summing up King says: “The Gilliat product is well constructed and easy to understand due to the quality of the literature.”


Suitability to market: Good

Investment strategy: Average     

Adviser remuneration: Average        

Overall 8/10


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