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Futures bright with Man

Man Investment Products has introduced Man AP strategic series 2, a Bermuda-based capital guaranteed bond that invests in managed futures and hedge funds.

Like the first series of the product, Man AP strategic series 2 is available in euros or dollars or investors can choose a combination of the two. The target return is between 14 per cent and 16 per cent and investors are guaranteed at least the return of their original capital by 2013. If the bonds perform well, the guarantee will increase accordingly.

The bond will invest mainly in managed futures through the Man-AHL institutional portfolio, with a smaller amount invested in hedge funds. Managed futures invest in futures contracts, which fix prices for the trading of goods such as precious metals and oil, to be delivered on a specified date in the future.

The bond will also invest in equity hedge and arbitrage hedge fund strategies. Equity hedge involves long and short selling, while arbitrage involves buying convertible bonds and selling the underlying investments short.

Futures and hedge funds can make money for investors irrespective of the direction of bond and equity markets, and this could be attractive in times of uncertainty. In addition, this product protects the original capital, which positions it at the lower end of thus high-risk area of investment.

Interest could come from pension funds, self-invested personal pensions and sophisticated high-net-worth investors who want the potential for higher returns than equities and stocks can deliver, but who understand the risks that not following those markets will involve.

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Important information

Investment risks

The value of an investment and any income from it can fall as well as rise and you may not get back the amount originally invested. Forecasts and past performance are not a guide to future performance. Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness. These are Neptune’s views and as such this document is deemed to be impartial research. We do not undertake to advise you of any change to our views.

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