View more on these topics

L&G strikes fourth time

Legal & General is targeting cautious investors with the fourth issue of protected portfolio, a capital protected Isa that is linked to 30 of the biggest companies in the UK.

The Isa has a five-year term and returns depend on the individual performance of companies such as Vodafone, BSkyB and Tesco. Investors get their capital back even if the stocks fall during the term, but any return above this requires the stocks to rise.

The value of each stock is measured at the beginning and end of the term. The total of these figures is divided by 30 to produce an average which becomes the final level of return,

Capital protected products allow investors to benefit from the stockmarket while shielding them from the risk to capital they could otherwise face if share prices fall. Bristol & West&#39s five-year guaranteed equity bond Isa is a similar product, but it differs from Legal & General&#39s Isa in that it is linked to three stockmarket indices. Some investors may feel that B&W&#39s diversification across the stocks contained in three indices spreads investment risk.

Others may feel safer within their home market and may choose less stocks for potentially higher returns than the capped growth available on index-linked products. But these investors would be taking higher risks with their growth potential and could end up with nothing beyond their original capital.

With both Isas, the capital guarantee applies only where the Isa is held to maturity, so investors would need to make sure they are not investing money they would later need in an emergency.


Mushens to leave M&G

M&G director of sales and marketing opportunities Jeffrey Mushens has left the company after 15 years to explore new horizons. Mushens, who intends to take the next few months off, will not be replaced by M&G. As a result UK retail chief executive Gary Shaughnessy assumes responsibility for governmental and regulatory issues, while managing director […]

Mind the gap

Big numbers are always striking and there are few things more striking than the claim that a £27bn gap exists between what people need to be putting aside for retirement and what is actually being saved in the UK.This claim by the ABI has become a familiar feature of the landscape. It is important, therefore, […]

R&SA adds three funds to Lifestyle bond

Royal & Sun Alliance UK Life is adding three corporate bond funds to its Lifestyle investment bond.The funds – the high income, extra income and maximum income – will be offered from May 1 and give IFAs the ability to select the individual funds or mix together a blend of the three.To mark the launch, […]

Field annuity bill wants clients told of all rates

Labour MP Frank Field has tabled a bill which aims to force annuity providers to supply policyholders with competitors&#39 rates when buying an annuity.It comes as the Government continues to hold highlevel talks with industry exp-erts about extending access and advice to annuities.The Treasury last week held a meeting with 25 industry figures, including representatives […]

Martin Foden discusses how convenience is affecting the construction of fixed income portfolios

In this short video, Martin Foden, head of credit research at Royal London Asset Management, discusses how convenience is affecting the construction of fixed income portfolios. Watch the video in full The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment