Who structured products are suitable for

Joachim Rohrmann: Thank you for the question, which can basically be answered with a “yes,” but in this case, investors should also be prepared to open up to forms of investment other than stocks or bonds, which have long proven their functionality and usefulness. Although these forms of investment require a comprehensive and detailed explanation of their structure, they are certainly justified and also have their own appeal.

In this context, we have had good experiences with using so-called structured products to maintain participation in the stock market while also ensuring a certain degree of protection.

Michael Kucher: The “Gordian knot” is a good metaphor for this, because investing directly in stocks means that I participate fully in both price losses and price gains. This means I can make good profits, but I can also suffer unpleasant losses. If I am an investor who wants to take advantage of opportunities but avoid losses, then in many cases I will remain on the sidelines with my liquidity and watch without participating in the game myself.

In Germany, unlike other countries such as Switzerland, the US, or China, we have a rather underdeveloped stock market culture, and a lot of wealth is actually held in low-interest overnight money accounts or even checking accounts. This means that the owners are effectively losing money, as there is also such a thing as inflation, i.e., creeping currency devaluation.

Joachim Rohrmann: At Bethmann Bank, we are constantly on the lookout for interesting investment opportunities that are suitable for our clients. Currently, companies in the fields of artificial intelligence, renewable energies, infrastructure, online gaming, and entertainment are of particular interest. These topics are the focus of international investors. If you look at the price performance of companies in these sectors, it can make your head spin. High triple-digit percentage gains in some cases should make you skeptical: if the price continues to rise, you want to try to take advantage of the opportunities that arise.

Michael Kucher: Bethmann Bank offers its clients a holistic approach to asset management. We always seek dialogue, and a relationship manager is the primary contact person. In consultation with the client, the relationship manager decides whether asset management or investment advice is the right approach for investing the client's funds. Of course, both options may be considered. If we identify a more tactical approach to investment behavior in the above questions, an investment advisor would certainly be consulted. This person is very knowledgeable about all types of securities and can work with the client to develop the right allocation for the portfolio.

Joachim Rohrmann: In principle, this is possible, although we always try to strike a reasonable balance between risk appetite and expected returns. Colleagues from the product department are involved in this task. Like my colleague Michael Kucher and myself, they then search specifically for solutions that reflect the needs of our clients.

In this specific case, that means seizing opportunities while avoiding excessive risks arising from the investment themes discussed. Since these areas are already performing well, we are looking at structured products such as certificates with a high level of capital protection. These are generally suitable for investors who have a lower risk appetite but still want to seize opportunities on the stock market.

Joachim Rohrmann: The first step is always a discussion with the relationship manager, who determines the risk tolerance of his or her client. In addition, investors should also be prepared to tolerate risks within certain limits in order to have the opportunity to participate in interesting investment themes in the short to medium term. If you decide to make such an investment, you will of course be informed in detail about the possible risks during the necessary investment consultation.

Michael Kucher: That's a very important question. On the one hand, we don't offer our own products. We constantly monitor the entire market and always try to find the best product for our clients at the time of investment. This allows us to avoid conflicts of interest. And by selecting from a wide range of providers, we can usually always find the most cost-effective product for our clients.

On the other hand, we also have a very stringent risk monitoring process in place during the term of these individual investment solutions. This enables us to react quickly and take countermeasures in the event of problems on the provider side.