Review: RBS offers income with downside protection on S&P 500

Royal Bank of Scotland is offering US investors a return even if the S&P 500 index falls by 20%, with the income coupons either at 1% or 8%, and the return of capital dependent on the year-to-year change of the index over the five-year term

This product is linked to the S&P 500 index and offers income coupons of 1% or 8% plus return of capital, depending on the annual performance of the index.

The annual return is defined as the percentage year-on-year change in the index: if it rises then investors receive a coupon of 8% for that year, and if it falls investors receive a coupon of 1%. For example, if the year-on-year change for the index is positive for the first three years of the investment and negative for the last two