IDAD US Income Deposit Plan - Issue 2 December 2023
The IDAD US Income Deposit Plan - Issue 2 December 2023 has a 6 year 2 week investment term offering an Interest Rate of 9.60% p.a. paid quarterly, if on any annual Observation date, the Underlying Index is between the upper and lower barrier levels the investor will receive 2.40%.
The closing date for ISA transfer applications is 24 November 2023.
Product Literature & Forms
You should always read the relevant plan brochure and any other plan documentation, for full details of the plan’s features, including any risks, and the terms and conditions. In addition to the plan brochure and terms and conditions there are other important documents, including a Key Information Document ('KID'), that you should consider, before deciding to invest in the plan.
If you do not fully understand the risks or are unsure as to the suitability of the investment, please contact us
How to Invest?
Please note: This plan is available on an advised basis only. If you are interested in this plan, please telephone us on 01639 860111 to arrange a free consultation
1 Call for a free initial telephone consultation. If you wish to progress the process of the product purchase, the regulatory process of ‘advice’ must commence.
2 The completion of a financial review – which will confirm details of your income/capital and investment needs and experience
3 The completion of a risk profiler - which will help to measure your attitude to risk.
This process will enable ‘advice’ to be provided in relation to the suitability of the product to meet with your needs. The fee for this service and process is 1.5% (subject to a minimum fee of £300) for focused advice – which is focused and narrowed to the suitability of the structured product you want to purchase.
This is a 6 year 2 week Deposit Plan linked to the performance of the S&P 500 Index. The Deposit Plan is constructed to offer a potential return of 9.60% p.a. If on any quarterly observation date (including the Final Observation date), the Underlying index is between the upper and lower barrier levels, the income of 2.40% per quarter will be paid. For clarity, if on any quarterly observation date, the index is outside the range, no income will be received, and the plan continues until the next observation date.
The opportunity for full capital protection and Income is the key aim of this investment.
The investment is linked to the S&P 500 Index (see page 6 of the Brochure for full details) and investors will benefit from growth or declining market conditions.
The initial investment into the Deposit Plan, minus any initial adviser fee, will be returned in full at maturity.
The Deposit Taker is Royal Bank of Canada. Royal Bank of Canada is a diversified financial services company. The Company provides personal and commercial banking, wealth management services, insurance, corporate and investment banking, and transaction processing services. Royal Bank offers its services to personal, business, public sector and institutional clients with operations worldwide.
Royal Bank of Canada are the Deposit Taker for the US Income Deposit Plan; therefore investors are exposed to the risk of them defaulting on their obligation to repay the capital and any returns due under the terms of the Deposit Plan.
Considerations when selecting the deposittaker / issuer:
Fitch, Moody’s and Standard & Poor’s are the main three independent credit ratings agencies that research and grade the ability of financial and other institutions to make the payments due from the Deposit / Plan issued and / or guaranteed by them. Each rating agency describes and names its ratings in a different way. For example, Standard & Poor’s highest possible rating is AAA, followed by AA and A. These three ratings along with their BBB rating are generally regarded as investment grade (i.e. of higher quality). All of these ratings, except the AAA rating, can also be modified by a plus or a minus to give a deposit taker’s / Issuers relative status within the grade; for example, A+, A, A- for the A rating.
Royal Bank of Canada have ratings from each of these agencies as follows:
*S&P’s AA- / Moody’s Aa1 / (*Source Bloomberg and Plan Termsheet)
All investments carry risk. It is identifying those risks, understanding how they may affect an investment and assessing whether an investment is suitable for your circumstances that is important.
The potential returns of most structured products and repaying the money invested are usually linked to the level of a stock market index and also depend on the financial stability of the issuer and counterparty bank. You should only consider investing if you understand and accept the risk of losing some or all of any money invested.
You should always read the relevant plan brochure and any other plan documentation, for full details of a plan’s features, including any risks, and the terms and conditions. In addition to the plan brochure and terms and conditions there are other important documents, including a Key Information Document (‘KID’), that you should consider, before deciding to invest in a plan.
Structured products should only be considered as part of a diversified and balanced portfolio.
Below is a summary of some of the main risks usually associated with an investment in structured products plans: