Higher-risk investments

Higher-risk investments

1. structured products

   • indices
   • tax treatment
   • gearing
   • capital protection
   • counterparty credit rating
   • investment period
   • currency
   • independent ratings

2. exchange traded commodities

   • structure
     • physical
       • holds physical commodity
       • cost of storage / insurance
       • most do not hold physical asset
         • except gold
     • synthetic
       • commodity futures
         • proxy for commodity price performance
         • regularly rolled forward
         • not physical asset
       • counterparty risk
       • no storage / insurance issues
   • performance
     • physical
       • little difference with underlying's spot price
     • synthetic
       • backwardation
       • contango

3. offshore property fund