Manor Park has introduced the fixed income and growth fund, an offshore closed-ended umbrella fund that has a three-year term.
The fund is linked to a basket of four stockmarket indices the FTSE 100, Eurostoxx 50, S&P 500 and Nikkei 225. It allows investors to choose between capital growth at 35 per cent gross after three years, income at 11 per cent gross a year or income at 2.6 per cent gross a quarter for three years.
Investors also get their original capital returned, but this depends on the performance of the stockmarket indices, making this product risky than some capital guaranteed products.
All the original capital is returned if all four indices are at the same level or higher than they were at the start of the investment term. If any index is lower at the end of the term than it was at the start, the capital is reduced by 0.75 per cent for every 1 per cent fall in the index. But any fall in the index will be capped at 33 per cent.
The fund may suit investors who are looking for higher returns than building society accounts and who can afford to tie their money up for the next three years. These investors must be prepared to take some risk with their capital even if they may be reluctant to invest directly in stocks and shares. Some investors could feel the low level of the stockmarkets make this a good time to invest, but others may not consider new investments until some of the recent uncertainty has cleared.
The FTSE 100 index fell from 5214.676 points on September 21, 1998 to 4433.694 points on September 21, 2001.