Chelsea Building Society has joined forces with Norwich Union to introduce the third issue of its portfolio extra fixed rate bond.
The bond is aimed at investors who are looking for income and growth and comes in two parts. A minimum of £10,000 must be invested in the bond. Up to 30 per cent of the bond will be placed in the Chelsea fixed rate account, which will have a fixed rate of 7.5 per cent until January 1, 2003. Investors can choose to take either monthly or annual income.
The remaining 70 per cent of the bond will be invested in the Norwich Union portfolio bond, which will aim for growth. This gives investors the chance to choose to invest in up to six of 23 Norwich Union life funds, ranging from guaranteed, with-profits, gilt, corporate bond, global equity and Japanese equity, depending on the risk level of the investor.
Investors are allowed one free fund switch a year, with a fee of £15 a fund for each switch thereafter.
According to Standard & Poors, the corporate bond, deposit, European equity, international index tracker and property funds are first quartile, the gilt, global equity, global bond, UK index tracker and US equity funds are second quartile, the balanced managed, defensive managed, Japan equity, South-East Asia and UK equity funds are third quartile and the cautious managed and guaranteed funds are fourth quartile, based on £1,000 invested on a bid-to-bid basis with gross income reinvested over one year to June 11, 2001.