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Split view over risk assessment

Structured product companies are divided over the best indicator of risk for IFAs.

Blue Sky Asset Management product development director Mark Dickson said IFAs have to weigh up a combination of risk barometers, including credit ratings, credit default swap levels and political factors to take a personal view on counterparty credit strength as none can be relied on in isolation.

He said: “Credit ratings are never up to the minute and they are not intended to be. CDS are potentially a real-time indicator of relative credit strength between different potential counterparties but the market is not well regulated and not always heavily traded. Ultimately, they have to take a view.”

But Barclays Wealth director Colin Dickie said it is the provider’s job to help IFAs to understand the risks. He said: “I am keen to disclose particular stress test results to make sure IFAs understand the risks and potential outcomes of the product.”

Keydata Investment Services director of sales and str- ategy Mark Owen said IFAs need to consider the risk of a product in the context of a client’s whole portfolio.

“A client does not put all their money in one structured product with one bank.”


The fifteen-year itch

By Neil Jones Technical support manager with Canada Life’s ican Technical Services Team. Canada Life offers a range of wealth management solutions, including retirement income planning, estate planning and investment solutions from a choice of jurisdictions, including the UK, Isle of Man and Republic of Ireland. The treatment of non-UK domiciles that are resident in […]


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