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Birmingham Midshires stocks up

Birmingham Midshires has designed a stockmarket linked mini cash individual savings account (Isa) that caters for investors with money from tax exempt special savings accounts (Tessas) to reinvest.

The guaranteed investment Isa allows Tessa reinvestments of up to £9,000 plus the £3,000 Isa allowance for the 2000/2001 and 2001/2002 tax years. This makes it possible for some clients to invest up to £15,000 in the Isa.

The Isa will track the performance of the FTSE 100 index over a five-year period. If the FTSE 100 grows during the term, investors will get the same percentage rate of interest as the growth in the index. Investors cannot make any withdrawals.

There are many stockmarket linked mini cash Isas that are aiming at the mature Tessa market. Bristol & West&#39s flexible Isa is linked to the FTSE 100, Nikkei 100 and Eurostoxx 50 indices, which means that potential growth is not concentrated on one index for five years.

However, the guaranteed investment Isa has the edge over the flexible Isa in that it is extending it is catering for the needs of investors who have matured Tessas and those who do not.

The FTSE 100 grew almost 60 per cent from 3715.92 points on February 27, 1996 to 5941.21 points on February 27, 2001.

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