What many investors get wrong — and what wealth professionals need to clarify
Structured products are often misunderstood. They’re dismissed as complex, risky, or exclusive — and that perception can prevent investors from seeing how powerful these instruments can be when used correctly.
If you’re working with clients who have questions, doubts, or hesitations, chances are you’re not alone. Here are four of the most common misconceptions about structured products — and what wealth professionals should know when addressing them.
1. “Structured products are too complex”
This is the most frequent objection — and it’s understandable. At first glance, structured products can seem technical. But in reality, they are built from simple components:
- A bond
- One or more options (to shape risk and return)
That’s it.
What makes them appear complex is the range of outcomes they can achieve. But that’s also their strength. When structured properly and explained clearly, these instruments offer defined, tailored solutions — not confusing ones.
For wealth professionals: the key is to focus on the objective, not the payoff formula. Start with what the client wants (income, protection, upside), and walk backward from there.
2. “Structured products are high-risk”
This assumption often comes from headlines — not facts. While some structures do carry market-linked risk, many structured products are designed with explicit capital protection. These solutions can be suitable even for conservative investors.
Risk can be adjusted based on:
- Whether principal protection is included
- The barrier or trigger levels
- The underlying asset or index
- The time horizon
In reality, structured products are flexible: you can dial risk up or down depending on the client’s profile. They’re not inherently risky — they’re customizable.
3. “Structured products are too expensive”
It’s true that structured products come with design, issuance, and distribution costs. But it’s also true that these products offer something traditional investments often don’t: outcome targeting.
When structured to meet a precise client goal — for example, a 7% coupon in a flat market with downside protection — the value of the outcome often outweighs the cost.
Plus, digital platforms and multi-issuer access are making the pricing environment more transparent and competitive than ever before.
Cost shouldn’t be the focus. Value delivery should be.
4. “Structured products are only for high-net-worth clients”
Structured products have historically been associated with private banks and ultra-high-net-worth portfolios. But that’s changing.
Thanks to:
- Platform access
- Scalable issuance
- Standardized wrappers
Structured solutions are now available at lower ticket sizes and broader accessibility.
Products like autocallables, income notes, or capital-protected strategies can be appropriate for moderately risk-tolerant investors, not just elite clients.
It’s not about wealth tier. It’s about investment fit.
Final Thought
Structured products aren’t for every client. But they’re also not as limited, risky, or complex as many assume.
When used well, they offer something most traditional instruments can’t: personalization.
And that makes them a valuable tool for professionals who want to move beyond broad exposure — and deliver outcomes that match the client’s expectations.
Stay connected with us for more updates and valuable insights. Follow us on LinkedIn, Twitter, and YouTube to join the conversation!
