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Kleinwort Benson rotates towards IFAs

KLEINWORT BENSON PRIVATE BANK

ELITE ROTATOR

Type:
Capital-protected offshore fund

Aim:
Growth by investing in an actively managed portfolio of 16 investment funds

Minimum investment:
Lump sum £50,000

Investment split:
100% linked to the performance of a portfolio of 16 investment funds

Place of registration: Luxemburg

Term:
Five years and three months

Return:
100% protection &#45 100% growth in underlying basket of funds, 80% protection &#45 110% growth in underlying basket of funds

Guarantee:
80% of original capital or original capital returned in full regardless of performance of underlying investments

Closing date:
July 29, 2004

Charges:
Initial up to 6%

Commission:
Initial up to 4%

Tel: 020 7475 5100

Kleinwort Benson Private Bank&#39s elite rotator is a capital-protected fund linked to a basket of 16 actively managed funds from various fund managers. It provides a choice of full capital protection with 100 per cent growth and 80 per cent capital protection with 110 per cent growth.

Highclere Financial Services partner Alan Lakey says the literature is the most complex and convoluted he has seen since the Scottish Widows extra income plan. He adds: “Clearly if the adviser cannot fathom the workings of the plan fully then the client will surely end up confused. In an industry crying out for clarity and accessibility this type of plan is ideal for anoraks and computer freaks.”

Lakey points out that this product is being aimed at IFAs with high-net-worth clients who may wish to diversify their portfolio. He explains that it offers various levels of potential capital protection on a limited offer basis.. He says: “At least the £50,000 minimum investment indicates that only those who can afford to lose money may do so.”

Lakey concludes: “While I applaud novel product design this excessively complex plan fails to impress. While structured products are more involved than managed or equity funds they do not have to be complex. Capital-protected offerings from Woolwich and NDF have simpler structures and more appeal. Kleinwort Benson should keep it simple.”

BROKER RATINGS:

Suitability to market: Poor
Investment strategy: Poor
Charges: Poor
Advisre remuneration: Average

Overall 3/10

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