Platform One, a UK online wrap platform targeted at high-net worth investors, has launched Cube Investing's Managed Portfolio Service, becoming the first platform in the UK to provide a risk-targeted structured product portfolio service for UK financial advisers.

UK advisers will be able to access three portfolios that are managed by James Brearley & Sons using Cube's Investment Products Research's (IPS), the firm's risk return analytics provided to help with the product selection.

"The exciting thing about this development is that it is the first time that managed portfolios of structured products are being made available in a UK platform," said Simon Harris, director of digital distribution at Cube. "This is a trend in the UK that is being led by Cube but we see scope for the market to follow. We think this will increase the visibility of structured products among advisors and will open up new opportunities to use our analytics."

This is the first time that UK advisers and their clients will have access to a range of discretionary managed portfolios of structured products that are designed to deliver defined income and growth outcomes via three 'model portfolios': defensive return, defensive income and balanced growth. The launch marks a significant development in the UK platform space that allows advisers to access the benefits of institutional structured products as well as the easy dealing, transparency and security via a platform offering, according to David Stuff, chief executive of Cube.

"With a strong and proven track record for performance and best-in-class reporting, I think that this represents a real milestone in the development of the UK investment landscape, offering genuine differentiation and innovation," said Stuff. "With Mifid 2 on the horizon, we're seeing more and more demand from advisers who are looking to benefit from the enhanced returns and capital protection of structured products but don't want the time-consuming hassle and regulatory risk of selecting individual products."

Cube's model portfolios are managed on a discretionary basis by James Brearley & Sons, and will invest exclusively in structured products. There is a mandate for each model portfolio that defines the type of structured product the investment manager can buy, in satisfying the defined investment objective and risk limits of each.

Cube's defensive return portfolio for instance is comprised by 66.7% return-based products and 33.3% participation structures including autocalls (44.5%), supertrackers (33.3%) and digital structures (22.2%). The counterparty exposure of the portfolio includes 29.5% to Natixis SI, 24.8% to JP Morgan, 15.1% to Credit Suisse, 10.4% to Morgan Stanley, 10.6% to RBC and 9.6% to Citigroup.

The new service is available to most investors including individuals, charities, trusts and companies. It may be used as part of a general investment portfolio, can also be applied to funds held in ISAs or SIPPs, and it may qualify for inclusion within an offshore life company bond for certain international investors.

According to Michael Fordham (pictured), managing director of Platform One, the Cube Risk Rated Portfolios as it meets the growing demand for structured products by financial advisers both in the UK and globally. "This new development marks real progress in the way that structured products can be used to provide genuinely differentiated returns with clearly defined risks,' said Fordham. 'Advisers and their clients who use Platform One can now access truly diversified portfolios that benefit from: institutional pricing, daily liquidity, Mifid compliant reporting and best-in-class analytics.'

Earlier this year, Cube reached an agreement with UK advisor P1 Investment Management which deployed Cube's managed portfolio service earlier this year shortly after Investec Wealth & Investment's launched a dedicated Structured Product Service for wealthier clients of financial advisers which offers two pre-determined portfolio mandates.

SRP data shows that the UK market has seen over 400 new products year to date with half the number of issuers active in the retail market (14) compared to 2016. Investec repeats as the most active issuer followed by Societe Generale, Natixis, Commerzbank and Credit Suisse. Knockout structures (342), reverse convertibles (310) and worst of (109) are the most featured payoff profiles in the UK year to date.

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