PRIVATE WEALTH
BY JUSTIN VAN WYK, PORTFOLIO MANAGER AT NEDBANK PRIVATE WEALTH
In a world defined by persistent volatility, shifting interest-rate cycles and uneven global growth, investors are increasingly asking a more nuanced question: How do I remain invested while managing risk more deliberately?
For high-net-worth and sophisticated investors, the answer is rarely binary. It is not about choosing growth or protection, equities, or fixed income, but designing portfolios with greater precision and intentional outcomes. This is where structured notes are once again coming into sharp focus.
BEYOND TRADITIONAL ASSET ALLOCATION Traditional portfolio construction relies heavily on asset class diversification balancing equities, bonds, property, and cash. This essential framework does not always respond well to prolonged uncertainty, sideways markets, or volatile drawdowns.
Structured notes represent an evolution in thinking. Rather than relying solely on market direction, they allow investors to shape return profiles around specific objectives, whether that be enhanced yield, partial capital protection, defined downside buffers, or participation in selected themes.
Structured notes combine traditional investments, such as bonds, with derivatives to create tailored payoffs linked to an underlying asset or index. The result is purpose-built exposure aligned to an investor’ s view, risk tolerance, and time horizon.
DESIGNED FOR OUTCOMES, NOT HEADLINES One of the most compelling attributes of structured notes is their outcome-oriented nature. Investors are not simply buying“ the market”; they are defining how they want to experience it.
For example, in markets where returns are expected to be modest but volatility remains elevated, structured notes can be designed to generate enhanced income, monetising volatility rather than fearing it. Similarly, in late-cycle or uncertain environments, structures can be shaped to offer partial capital protection while still allowing for measured participation should markets recover.
This flexibility is particularly relevant for investors who are capital-aware; those balancing growth ambitions with legacy planning, income needs, or wealth preservation objectives.
A PRAGMATIC RESPONSE TO VOLATILITY Volatility is often framed negatively, yet from a structuring perspective, it is a resource. Elevated volatility can increase the attractiveness of certain payoffs, allowing investors to potentially earn higher yields or define more defensive structures without surrendering all upside.
80 INBOUND SA / AUGUST 2026