UK Guardian: Protected Plans "Don't Set My Pulse Racing"

Structured investment plans
"These each-way bets don't set my pulse racing," says the Guardian's Paul Farrow

They don't have the sexiest name, but that is not stopping investors from lapping them up.

Structured investment plans, which are linked to stock market indices or a basket of shares and guarantee either full or partial capital protection, often prosper during times of uncertainty. And with the all the gloom and doom, they are enjoying a boom. They are on course for a record year in terms of sales.

This comes as no surprise. Providers will always try to cash in on the prevailing mood of investors. And, boy, are they cashing in.

Whether they are linked to agriculture, Africa, China or even bombed-out banking shares, new structured plans are coming thick and fast.

I'm sure that many investors will be tempted by the latest offering from James Hay, which is a five-year plan linked to four banking shares with full capital protection - although HBOS is not one of the four. But investing in structured products is a little like betting on a horse race with an each-way wager and ending up with a second or third placed win, rather than a victory. And the trouble with an each-way bet is that, with a tinge of regret, you are often left thinking of what might have been – and whether the smaller win was worth the effort in the first place.

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