Cantor Fitzgerald 3 year capital guarantee fixed rate bonds

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Carmur

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I would be very interested to hear anyone’s experience with this type of investment . The offer is 3.75% return per annum guaranteed by Goldman Sacks but no mention of any catches eg : fees charged on this type of product .
Would one be better off investing vis Raisin in some European banks instead , given they are covered by the €100,000 guarantee ?
 
There is a counterparty risk and no DGS €100k guarantee.

The bond is callable at six month intervals, so if interest rates decline significantly, SG could wind it up and return you capital together with interest earned to date. This would leave you looking for a new home for your capital at a time when interest rates were lower.
 
Freelance , many thanks for your reply . Yes you are correct the bond is callable at six monthly intervals , which is a downside for the investor but gives additional protection to the investment company if the interest rates go south .
Outside of this what are the other catches with this type of bond , charges ?
 
You should check the key investor document for charges etc. It should be there. From looking at some of the previous structured products offered through Cantor Fitzgerald, the charges were built-in, so the return that they were quoting was after all charges were paid. Not sure whether that is the case here.
I think the main "risk" is what Freelance already called out. No deposit guarantee scheme if anything goes wrong with Goldman Sachs, or the particular legal entity that is actually the counterparty. Again, from looking at a previous prospectus, I recall that the legal entity was part of the Goldman Sachs group and guaranteed by the group, whatever that means in practice. I though the risk was quite low. But up to each person to decide for themselves whether they would be comfortable with this level of risk.
 
I would run a mile from these kind of structured products


They are designed to lure customers looking for capital guarantees - with alluring rates as a honey trap

Just buy government bonds
 
Many thanks Persius for your advice . I will re check to see if I missed anything pertaining to the charges , but could not see initially .I think the upside is capped in favour of the investment company and any of the downside NSG , callable option at six monthly intervals is all down to the investor , this being a big negative verses other investment options like the continental banks vis Raisin .
 
jpd said:
I would run a mile from these kind of structured products


They are designed to lure customers looking for capital guarantees - with alluring rates as a honey trap

Just buy government bonds
Click to expand...
jpd said:
I would run a mile from these kind of structured products


They are designed to lure customers looking for capital guarantees - with alluring rates as a honey trap

Just buy government bonds
Click to expand...
JPD , many thanks for your advice . Persius , is correct the charges are inclusive in the offer having checked . However I am inclined to agree that there are other options with capital guarantees , which are more attractive for the investor .
 
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