View more on these topics

NDF offers index innovation

NDF Administration has brought out a capital-protected bond that can
be linked to the Halifax House Price Index, the FTSE 100 index or a
combination of both indices for six years.

The bond will return all investors&#39 original capital at the end of the
term regardless of index performance. Investors will also get 100 per
cent of the rise in their chosen index or 100 per cent of the average
rise in both indices if they split their capital between the two.

There are five options available to investors in total. Under option
one, 100 per cent of the capital is linked to the Halifax House Price
index, while option two provides a 75 per cent-25 per cent split in
favour of the Halifax index. Option three offers an equal split between
both indices while option four is a 75 per cent/25 per cent split in
favour of the FTSE 100 index. Finally, option five is 100 per cent linked
to the FTSE 100 index.

To calculate the returns, the closing value of the indices are recorded
at the start of the term and compared with an average produced over
the final 18 months of the term. If the indices have fallen or stayed the
same, investors will receive only their original capital. But if there has
been some growth, investors will receive 100 per cent of this growth.

Newcastle Building Society is currently offering a similar product, the
guaranteed mixed asset bond issue one. This has a term of five
years and six months and although it is linked to the same indices on
similar terms to the NDF product.

However, investors cannot deviate from the Newcastle product&#39s
pre-defined 50/50 split. This lack of flexibility could be regarded as a
drawback, but some investors may prefer the Newcastle product if
they feel a six-year term is too long.


OFT ponders parameters in sub-prime probe

Sub-prime and non-status lenders are to be investigated by the Office of Fair Trading as it revises its guidelines for the sector. The OFT&#39s annual consultation paper reveals that it is to consult on and revise if necessary its guidance on non-status lending. It says it wants to achieve the greatest benefit for vulnerable consumers […]

Platinum dazzles in China

Platinum Capital Management has created a hedge fund that will take a long and short investment approach to Chinese companies and companies based elsewhere that will profit from growth in China. The Platinum dynasty fund has a target return of between 15 per cent and 20 per cent a year. It was introduced because Platinum […]

Widows adding eight fund links in triple deal

Scottish Widows has bolstered its life and pension range with fund links from New Star, Jupiter and Schroders. Eight funds will be added to Widows&#39 life and pension range, including Schroders popular UK alpha plus fund run by Richard Buxton. The funds will be available across most of Widows&#39 life and pension products. Fund companies […]

Sofa to seek new MD as Lawless moves on

Sofa managing director Brian Lawless is leaving at the end of February after nearly two years in the role. He is moving to Exeter and felt he would be unable to continue with his present level of commitment to Sofa. He will be taking up a part-time appointment with Jelf IFM Financial Planning in Bristol. […]

Embrace simplicity!

By Fiona Holmes, proposition communications manager When I first took out critical illness cover, I was overwhelmed. It wasn’t just the form filling, it was finding out about the sheer number of illnesses I was covered for. Did it give me peace of mind that I was covered for neuromyelitis optica or systematic lupus erythematosus? […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment