Glossary - S

This section provides an explanation for some of the jargon used to describe structured retail products. If you would like us to add additional words then please let us know by clicking here.


The S&P500 index is an index of shares of the largest 500 companies weighted by market capitalisation in the US.

Secondary market

A secondary market is used to describe the market in any financial product that allows investors to sell or buy more of their investment after making the original purchase.

In the case of many structured products, the bespoke nature of the investment means that secondary markets do not often exist, and even if they do, liquidity is often poor. For this reason, investors are usually advised to hold their structured product for the term of the investment.

Secondary measurement period

This usually refers to a set period o time usually at the end of the term of a structured product, during which the level of the underlying is recorded in order to determine the final return.

This period may be as short as a few days or as long as twelve months.

Securities Company

A financial institution that focuses on the issuance and trading of financial securities.


The investment is made via a financial security such as a bond, certificate, medium term note, structured bond or warrant.


Insurance Policy


Certificate in Norwegian

Shark Fin

A product paying a minimum return at maturity plus a participation in the rise of the underlying. However if an upper barrier level is breached at any time during the investment period then the return at maturity is reduced to a fixed amount.


A “short” position is the term used to describe a situation where one has sold a quantity of some financial asset i.e. a share, bond or derivative, without actually owning it in the first place. In order to do this one usually borrows the asset initially or else would anticipate buying it before the original sale was settled.

For example, if one is “short of £1m HSBC shares”, it means one has sold £1m of HSBC shares in anticipation of a fall in price with the intention of buying them back after the price fall so as to make a profit.


The SMI index is an index of shares of the largest 27 companies weighted by market capitalisation listed in Switzerland.

Soft Protection

This term refers to a feature of some structured products that provide a full return of capital subject to the underlying index not falling below a set level prior to maturity.

This level, sometimes called a barrier level, provides for a limited degree of capital protection such that even if the underlying falls during the term, as long as this level is not breached then capital is returned in full. In addition, in most cases, even if the level is breached, capital can be returned in full if the underlying subsequently rises back to its initial level.

Soft protection provides a limited degree of capital protection as opposed to hard protection that provides full capital protection regardless of the performance of the underlying.

Solactive U.S. Dynamic Allocation Index

The index is a rules-based, systematic strategy index that provides exposure to a weighted portfolio of US Select Sector SPDR ETFs and the iShares 7-10 Year Treasury Bond ETF. The allocation to each US Select Sector ETF is changed every month depending on whether its price is higher or lower than its 6 month moving average. The exposure to the Treasury Bond ETF is 100% minus the sum of all US Select Sector ETF allocations.

Special Purpose Company - Dublin

Account where the investment is in shares of a Dublin listed special purpose company.

Special Purpose Company - Guernsey

Account where the investment is in shares of a Guernsey registered special purpose company.

Special Purpose Company - Jersey

Account where the investment is in shares of a Jersey registered special purpose company.

Special Purpose Company or Vehicle

A special purpose company (SPC) or special purpose vehicle (SPV) is any legal entity (usually a company or a fund) that is created specifically to create a structured product.

Such entities are often created in offshore centres such a Jersey, Guernsey or Dublin, since these can provide attractive tax and regulatory regimes. The entity will typically issues shares or bonds that will provide investors with a specific return.

Special Purpose Vehicle

A legal entity set-up for the sole purpose of issuing notes or other financial products, usually within tax-advantageous jurisdictions.

Spread Option

A return based on the widening of the performance between equities


Small Self-Administered Pension (SSAP) is an Irish corporate pension scheme with 12 or fewer members.

Starting index level

See initial index level.


A return based on the widening on the curve between long-term rates and short-term rates.

Stocks and Shares ISA

The term Stocks and Shares ISA refers to the component of an Individual Savings account (ISA) that can be invested in shares. See Individual Savings Account (ISA).


A straddle is the name given to a position in two financial options whereby one is simultaneously long (or short) of both a call option and put option with the same strike price.

The object of such a position is to make a profit (if one is long) from any movement, up or down, in the underlying.


A strangle is similar to a straddle position except that the strike price of the call option is higher than the strike price of the put option.

Strike date

This is the date on which the initial index level is fixed

Strike levels

The strike level is the initial level of the underlying index or indices used in calculating the final return. For certain products, such as cliquets, this figure is the initial strike level for the first period only. The letter (e) after a strike level indicates that this level is estimated from the product literature and has not yet been verified by the product provider.

Strike price or level

This is the price or index level that is set in an option contract. The option buyer has the right to buy (for a call Option) or sell (for a put option) the underlying at this price level.

Structured Bond

A debt instrument by which the investor loans money to an entity (company or government), whose value is determined by the price movement of the underlying asset.

Structured product

The term Structured Product is the name given to an investment product that provides a return that is pre-determined with reference to the performance of one or more underlying markets.

The performance of a structured product is therefore based only on the performance of this underlying and not on the discretion of the product provider. Often, but not always, the product relies on the use of derivatives to generate the return.

Structured products typically come in two forms: growth products (which may provide an element of capital protection) and income products (that provide a fixed high income but with a risk to the capital return).

Struktureret Obligation

Structured bond in Danish

Super Tracker

A super tracker is a type of structured product that provides a degree of capital protection together with participation in any rise in the underlying index.

There are many variations but typically the product might offer a return equal to 200% of any rise in the FTSE100 and full capital protection unless the index falls by more that 50% during the investment term and fails to recover by maturity. If this did occur then the capital return would be reduced on a 1:1 basis for the fall in the FTSE100 index.

See also Airbag, Super Tracker and Tracker products.

Swiss Midcap Price Index

The SMIM (SMI Mid) comprises the 30 largest mid-cap stocks in the Swiss equity market that are not included in the blue chip SMI index (the components are selected according to market capitalisation and turnover in the given shares). It is free-float-capital weighted, and only the tradable outstanding shares are taken into account in its calculation.