Canada Life has moved into the market for onshore unit-linked bonds with the introduction of the select investment bond.
This bond provides investors with a choice of 40 internally and externally managed funds under the open architecture option, plus three manager of manager portfolio funds run by the Dutch bank Insinger de Beaufort.
The open architecture option is designed for investors who want to make their own investment decisions or who want to pass this responsibility to an IFA. Up to 10 funds can be selected at any one time, from fund management groups such as Fidelity and Threadneedle.
The manager of manager portfolio funds provide portfolios that are tailored towards the risk profile of investors. The international managed portfolio has the highest risk and is benchmarked against the MSCI world index. The balanced managed portfolio fund is a medium-risk fund and unlike the international managed portfolio fund, it has exposure to bonds. The investment split is 80 per cent equities and 20 per cent bonds. The cautious managed portfolio fund has the lowest risk of the three funds and its investment split is 40per cent equities and 60 per cent bonds.
In some respects, the bond is similar to the Cazenove universal investment bond, which provides access to four manager of manager portfolios. However, the Cazenove product has a higher minimum investment of £50,000, compared with Canada Lifes minimum of £5,000. Canada Lifes open architecture option also allows investors to construct their own portfolios, which the Cazenove product does not.