Two minutes with… Ian Lowes, managing director at Lowes Financial Management

Tell us a bit about your annual structured product review?

We have been reviewing the structured product market for over two decades and our database now extends to over 6,700 products.  While we publish details of every new product on StructuredProductReview.com identifying which products we ‘Prefer’ at the time of launch, the annual review looks back at how the products that matured in the previous year performed.  Structured products are designed to perform in line with stated terms to the extent that performance can be forecast by reference to all market projections – our annual review analyses the performance by reference to the market conditions that actually prevailed.

Whilst markets in 2018 were significantly more volatile than the preceding year, it has proved to be a tremendous year for structured investments, with not one retail structured product maturing with a loss. There aren’t many other investment sectors that could boast the same.

A copy of the review can be obtained from www.Lowes.co.uk/MaturityReport.

What did this year’s review reveal?

The review found that of the 381 structured products that matured in 2018, none matured at a loss and just 23 products (6.04%) returned capital alone, while the remaining 358 (93.96%) generated positive returns with the average annualised return across all products being 6.33%. Our own list of ‘Preferred’ plans matured with even higher returns – the 107 products we specifically highlighted to advisers delivered an average annualised return of 7.88%.

Do enough advisers use structured products in the UK?

In a word, no.  I really think the sector has passed many independent advisers by, perhaps because of mis-conceptions, perhaps because of a lack of profile, maybe a perception of complexity or burdensome administration.  While the maturity results are simply evidence of past performance, the defined nature of the returns offered by structured investments are such that it is possible to forecast the future performance in all market scenarios and there will be few investment advisers who would argue that the right market conditions required to see positive maturities will not prevail eventually.  Institutions have caught on to structured investments in a big way, as have many advisers, but there are lots more who don’t yet use them.  Clearly funds of structured investments, selected and managed by those with the requisite knowledge is the next big thing – and of course we have now launched our own.

Why do you do what you do, and what makes this area of financial services so important to you?

Being part of financial services is something that has been in my blood my entire life as my father was an independent financial adviser and founded Lowes in 1971. I can’t imagine doing anything else as helping people make a significant difference to their wealth through imparting our expertise and knowledge is such a gratifying experience, particularly when we receive the recognition and testimonials we do.

If you could give one piece of financial advice to yourself, what would it be?

Remember not to forget that there are things that you know you don’t know.

What do you do outside of work?

I have a five-month-old daughter – need I say more?  When I’m not at work and she’s asleep my passions for science, technology, cars, music, the business and financial services keep me busy.

What is the one column or website you read every day?

BBC News.

What would you do with a £10,000 windfall?

Give it to charity – but keep the tax relief.