New Star is teaming up with Credit Suisse First Boston to set up a structured product offering investors high income or growth with a degree of capital protection.
The New Star income or protected capital plan is a five-year product offering returns linked to the performance of stocks in the Dow Jones Global Titans index of 50 individual global large-cap stocks.
It has two income options. The first is an annual option with fixed income of 10 per cent and 50-100 per cent repayment of capital at maturity depending on the performance of the stocks in the index. The second option is 2.25 per cent income per quarter and 55-100 per cent capital repayment depending on the stocks.
The growth option provides up to 55 per cent growth over five years and returns 100 per cent of investors' capital at maturity. Maximum returns will be paid as long as no underlying stock falls by more than 30 per cent by the end of the period.
Minimum investment is £7,000. Initial charge is 2.5 per cent. Commission is 3.25 per cent. It is available as an Isa and Pep transfer.
Director of structured products group Ravi Anand says: “We are primarily known for active fund management but we recognise that many invest-ors are looking for products offering income or growth with protection of capital.”
BestInvest structural product analyst Charles Barlow says: “We are not keen on products that do not have a minimum guaranteed bonus. We will cover it but not actively recommend.”