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Axa serves and protects


Capital Protected FTSE Bond

Guaranteed equity bond

Growth linked to the performance of the FTSE 100 index

Minimum-maximum investment:
£5,000-no maximum

Five years and six months

Original capital returned in full regardless of performance of index

Up to 77% growth at end of term

Closing date:
March 19, 2004

Initial 3%


The Axa capital protected FTSE bond is a guaranteed equity bond that will return investors&#39 capital at the end of the term regardless of index performance, plus 77 per cent of any growth in the index.

Highclere Financial Services partner Alan Lakey thinks that although a choice of structured products is to be welcomed, the Axa product does not sparkle. He prefers products from the likes of HSBC, which regularly offers what he regards as excellent capital-secure products.
He says: “This is an unexciting but solid product which will sell on Axa&#39s reputation as much as the plan features. Axa&#39s name and reputation is a plus and the literature extremely succinct and easily understood.”

According to Lakey, the 3 per cent commission Axa pays is typical and quite reasonable. However, when asked what he does not like about the product and how Axa could have improved on the design he says: “The averaging of the final five quarter index positions receives the downside, but with the downside already limited, it would have been better to have used a final spot position.”

He concludes: “The capital protection is likely to appeal to investors who remain singed from recent stockmarket turmoil.”


Suitability to market: Average
Investment strategy: Average
Adviser remuneration: Good

Overall 5/10


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