Where cash can be held - bank and building society accounts

Question 1

What are Structured deposits

Answer 1

these often take the form of
“Guaranteed Investment Account” and pay interest based on the performance of an index such as the FTSE 100 and
will pay out at maturity often a return of capital (which is the only element that is guaranteed) or a percentage (such as
120%) of the increase in the index over the term of the contract.

Question 2

What are the main differences between structured deposits and structured products?

Answer 2

They share the same characteristics as above but Structured Products differ in the fact that capital protection is provided by a third party issuing debt securities to the
structured product provider. This adds counterparty risk (default risk). In addition structured products allow exposure to the returns of a higher risk asset by the
inclusion of derivative contracts

Question 3

Whatare the basics with Cash ISAs

Answer 3

these are tax-free deposit accounts with a restriction imposed by law on maximum contributions. In 2023/24 the maximum
investment per person is £20,000. They are, as the name suggests, individual and cannot be held jointly. The tax benefits mean that they are restricted to those over 16 and
resident in the UK.

Question 4

Can ISAs be transferred and what options are available?

Answer 4

Transfers between ISAs are permitted and cash ISAs can also be transferred to stocks and shares ISAs or vice versa. Where a transfer of a previous year’s subscription
is made, the saver can transfer all or part of their funds. Where the current year’s subscription is transferred, the whole amount must be transferred and the first ISA is deemed to be voided and replaced with the new one.