JP Morgan Fleming has confirmed it is introducing a guaranteed
fund-of-funds product in October, investing in a selection of its own funds.
The product, revealed in Money Marketing last month, will aim to achieve
growth over five years while providing a 100 per cent capital guarantee.
The closed-end fund will invest in a basket of JPMF funds, with 30 per
cent in fixed interest and 70 per cent in equities. It will be allocated
according to global market weightings.
As well as returning 100 per cent of capital, the fund will aim to offer
80 per cent participation in the performance of the underlying funds. But
this could be subject to change during the offer period between mid-October
and mid-November.
The starting price will be a six-month average of the prices of the
underlying funds, while the end price will be an average over the final 12
months.
Investors will have the option to exit the fund quarterly although they
will be subject to an exit fee to cover costs.
The fund will have no initial or annual charges but IFAs can take upfront
commission of 3.5 per cent or lower initial of 1 per cent with 0.5 per cent
trail.
The fund is still subject to final regulatory approval.
Head of IFA & third-party distribution Barry Richards says: “We know
people are scared of losing their capital so we wanted to give them an
alternative.”
