Monty Bruell, the president and CEO of recently-formed Tru Alpha Capital Advisors in Atlanta, Georgia, is a fan of both principal-protected notes and, right now, emerging-market currency notes that bet against the US dollar, SRP has learned.
"I think, particularly in this economic climate, retail and institutional investors have two competing interests: preserving capital and generating alpha," Bruell told SRP. "With principal-protected notes in particular, it's a great way to capture these."
Bruell said he explained to investors that they can capture the upside and, if there is none, at least they will get their money back. He described the recent downturn as 'a wakeup call' to investors that had become over-exuberant. He thinks investors are beginning to put their toes back in the water.
Right now, Bruell, a former Morgan Stanley wealth manager, favours structured notes for currency-market plays. "A structured product is a good way to have exposure to a currency's upside potential without the same risk as going directly to the currency market," he said. For those clients with between $2m and $3m, structured notes can customise the risk like no other investment, he added.
Tru Alpha Capital Advisors specialises in international and alternative investments.