The Friends guaranteed bond is aimed at the more cautious investor with a lump sum of £10,000 or more, and invests in a purpose built capital assured fund, which is made up of a special fixed interest investment and the Barclays dynamic tracker fund.
A guaranteed 100.1 per cent payment of the value of the bond will be paid either upon death or after the five year lock-in period if the investor wishes to cash in. The guaranteed amount after five years has the ability to increase and any increases are locked in for the lifetime of the bond.
Friends Provident head of wealth management Christine Foyster said: “We’ve introduced our bond to reflect IFA and consumer need for secure investment products. Statistics from recent consumer research that we commissioned revealed that nearly two thirds (62 per cent) of investors said that they would be more inclined to opt for products with guarantees.
“The guaranteed bond provides the ideal opportunity for the investor who may want to protect their capital for their beneficiaries. Of particular interest is the fact that customers are able to keep their guarantee as long as they remain invested in the bond, so there is no pre-determined end date to the guarantee.”
The annual management charge is currently 2 per cent per annum. This charge is taken from the capital assured fund before the unit price is calculated.