View more on these topics

Dual track solution for Royal Skandia

ROYAL SKANDIA

UK Equity Fund

Type: Offshore unit-linked fund.

Aim: Growth by investing in UK actively and passively managed funds.

Minimum investment: £15,000 lump sum, £100 a month.

Place of registration: Isle of Man.

Investment split: 100 per cent UK.

Yield: Nil.

Charges: Annual one per cent.

Commission: Subject to negotiation.

Tel: 01624 611611.

David Cuthbert, corporate sales manager, Russell Plaice & Partners

Rob Jackson, principal, Kensington’s Investment Management (Newcastle)

David Flowers, director, RBC (UK).

Market suitability 7.0

Company’s reputation 8.3

Flexibility 8.6

Charges 5.0

Commission 6.0

Product literature 7.5

Isle of Man-based Royal Skandia has introduced the UK equity fund, an offshore unit-linked fund that aims for growth by investing in UK actively and passively managed funds. The product will have two portfolios, one actively managed by Mercury Asset Management, and the other investing in the FTSE allshare index fund, which is managed by Gartmore Investment Management.

Looking at how well the fund fits into the market, Cuthbert says: "Tracker funds are becoming more popular, and this fund makes available a number of passive tracker and actively managed assets to give clients the best of both worlds. By restricting the fund to UK equities, the risk level is not too high.

Jackson says: "This product will slot into the market very well. The product is flexible and has some good fund managers involved, such as Gartmore and Mercury."

Flowers says: "This is a useful addition to Royal Skandia’s multi-manager range of funds. However it must be remembered that this is a fairly narrow and sophisticated market."

Examining what type of client the fund is suitable for, Jackson says: "This is for the more sophisticated client, who wants to invest in the UK equity market but who does not have the time to spend looking for the best managers in the sector and who would also like to use offshore funds for tax-efficiency. Perhaps it can also be used for a non-UK resident at this point, with a view to returning later, or to set up a trust fund for minors."

Flowers says: "The product would be best suited for a client who is already attracted to Royal Skandia’s investment product range. Also for those who have large portfolios but who do not want to actively manage their investments."

Cuthbert adds: "This is for clients who wish to be involved in equity investment with the potential for good returns without taking a high risk."

Moving on to the types of marketing opportunities that the product will provide, the panel are split, with Flowers unable to suggest any apart from making it available to existing Royal Skandia investors.

However Cuthbert says: "Offshore investment does tend to put some clients off, but the Royal Skandia product should help to overcome some resistance, as the investment will be in UK companies."

Jackson says: "I can see two opportunities here. Firstly, it could be recommended for long term investment for trusts to grandchildren and secondly, it can be used for investments for growth using gross roll-up for higher rate taxpayers."

Identifying the product’s strong points, Cuthbert says: "The biggest plus is the fact that it combines passive and active management, along with the fact that there are some good fund managers attached to it."

Flowers says: "This product fills a gap for specifically UK orientated equity investors who are seeking a multi-manager type of investment philosophy."

Recommended

Stakeholder sweepstake

The year will have a flying start as stakeholder loose ends are tied up and we prepare to enter the brave new world of defined contributions. Many customers take advantage of the last chance to set up old-style life insurance and waiver. April arrives and stakeholder becomes a reality. Pension-sharing orders are coming through from […]

Nationwide demutualisation campaign setback

The campaign to demutualise Nationwide suffered a setback as Stephen Major, the plumber from Northern Ireland, withdrew his support. Major, who led the campaign that brought about Bradford & Bingley&#39s conversion last month, said he did not think the campaign would succeed and now believes that any windfall will not compensate for the loss of […]

Tories pledge to adopt McDonald annuity plans

A Conservative Government would adopt the proposals of former Labour social services spokeswoman Dr Oonagh McDonald as part of sweeping reforms of the annuity rules. The McDonald report, written by the former regulator and prominent Labour MP last year, says people should only be obliged to purchase an annuity that secures a sufficient level of […]

AA drives into the IFA sector with annuities

AA Financial Services is re-entering the IFA market with plans to build the UK&#39s number one IFA brand through a new company AAIFA. It aims to build the brand by targeting the AA&#39s 11 million members. The first phase will see AAIFA entering the annuity, Isa, term insurance and investment bond markets by the second […]

Childcare - thumbnail

Three questions for employers…

The Family and Childcare Trust’s annual survey has been widely reported in the media and the two headline figures were these: the average cost of a nursery place for a child under two has risen by 33 per cent since 2010; and the costs have risen by five per cent in a single year.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com