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High point

FRIENDS PROVIDENT
INTERNATIONALZenithType: Unit-linked offshore bondAim: Growth and
income by investing in a maximum of 10 funds from 31 fund management
groupsMinimum investment: £10,000, $15,000, e15,000Fund links:
Choice of 95 funds from Aberdeen, AHL, Barclays, Baring Asset
Management, Brandeaux, Ciptadana, Circus Capital, Collins Stewart,
Dresdner, Fidelity, Friends Provident International, Franklin
Templeton, Gartmore, GAM, Glanmore, HSBC, Invesco, Investec, JF,
Merrill Lynch, Momentum, Neville James, Nordea, Principal, Sarasin
Chiswell, Schroders, Surrenda-link, Thames River Capital, Vanguard,
Value PartnersAllocation rates: Investments up to
£24,999/$37,499/e37,499 – 100%,
£25,000-£49,999/$37,500-$74,999/e37,500-e74,999 – 101%,
£50,000-£99,999/$75,000-$149,99/e75,000-e149,99 – 102%,
£100,000-£199,99/$150,000-$299,99/e150,000-e299,99 – 103%
£200,000/£300,000/ e300,000 and above – 104%Place of
registration: Isle of ManSwitched: Free unlimited switchesCharges:
Establishment charge 0.4% a quarter in first five years, annual 1.2%,
plus annual 0.1-3.35% depending on external fund links
chosenCommission: Initial 5% or initial 3% plus 0.5% renewalTel:
01624 821111Friends Provident International’s Zenith is an offshore
unit-linked bond providing access to 95 fund links from 31 groups.

TBO Corporate Benefit research director Godfrey Bloom regards this as
a well presented product which joins the international bond stable.
He says: “The product as it stands is a strong contender among its
peer group. The charges are in the mainstream for charging structures
and the fund selections are adequate. In fact, they are more than
adequate, with strong property funds and access to gold.”

However, in Bloom’s view, offshore bonds have a problem insofar as the
underlying charging structure crucifies cautious portfolios. He says:
“For example, if the annual management charge is 1.2 per cent and
the underlying management charge is 1.5 per cent, the overall charges
amount to 2.7 per cent. If the underlying fund is a corporate bond
fund, this will account for 50 per cent of the running yield.”

Bloom suggests that clients with a cautious risk profile could stay
with the inc-ome gilt fund link managed by Isis, with an annual
management charge of 0.25 per cent. He says: “This gives an overall
structured charge of 1.45 per cent which is just about sustainable. I
leave out the establishment charge which pays for advice and is
therefore not part of the equation.”

Bloom concludes: “The staff at Friends Provident International are a
cut above the usual on the Isle of Man which is rap-idly gaining the
reputation among IFAs as a no-hope zone of incompetence.”

BROKER RATINGSSuitability to market: GoodFlexibility:
GoodCharges: AverageAdviser remuneration:
AverageOverall 8/10

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