Meteor Asset Management is pitching its first income knockout structure for UK investors, offering a 7.25% headline rate.
Meteor MD, Graham Devile said that the product is an alternative to FTSE100-linked growth products.
"With many UK investors FTSE-centric in their investment selection and with markets lacking confidence and direction, we have been looking to launch a FTSE-only income plan that offers not only a high level of potential income, but also the possibility of an early maturity thereby allowing investors - should markets not retreat significantly - to rebalance and adjust their portfolios."
The FTSE Annual Income Kick-out Plan September 2012 is a six-year FTSE100-linked structure. Every year throughout the investment, the product will pay a 7.25% income coupon as long as the underlying is above 65% of its strike level.
In addition, the product will mature early from the third year of the term onwards paying a 7.25% pa return per each year elapsed if the underlying is at or above its initial level. The product is 50% soft-protected.
SRP data shows that only 12 income products with a knockout payoff profile have been marketed in the UK since 2007. Meteor's FTSE Annual Income Kick-out Plan September 2012 is the first such structure since Merchant Capital's Income Plan Phoenix.