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nvesta focuses on FTSE

nvesta has established the FTSE focus plan 2, a guaranteed equity bond that offers investors a choice between income and growth.

The bond is linked to the performance of the FTSE 100 index over a term of three years and two months. Investors can choose between annual income of 9 per cent a year, monthly income of 0.7 per cent or growth of 30 per cent.

Investors get all their original capital returned provided the FTSE 100 index does not fall by more than 25 per cent between year two and the end of the term. The performance of the index during the first 12 months is omitted because nvesta believes this will provide added comfort to investors who are concerned about stock performance during the war with Iraq.

If the index does fall by more than 25 per cent during the specified period, capital is reduced by 1 per cent for every 1 per cent fall in the index for falls between 25 per cent and 39 per cent. A fall of 40 per cent or more will result in a 2 per cent reduction in capital for every 1 per cent fall in the index.

This product could suit investors who are looking for a high level of income over a relatively short period, but this bond is higher risk relative to some bonds in a number of ways. Firstly, the term of three years and two months is short compared with many bonds that ride out short-term volatility over at least five years. Secondly, there is no income payable during the last two months for those choosing to take annual income and finally, investors stand to lose a lot of their capital if the conditions for a full capital return are not met.


Simon Holt

Skipton Financial Services managing director Simon Holt has just invested in a place abroad and would like to get the chance to use it. Resting on the Costa del Sol near Gibraltar, it is an apartment that, when finished, will be the perfect Spanish hideaway for him to escape from the busy series of acquisitions […]

Why stop at banks when societies are also to blame?

What an interesting letters section last week.First, concerning the letter headlined, Call banks to account, I totally agree with Julian Stevens&#39 comments but why stop at banks? Building societies, national and local, are only concerned in “selling” financial products and no regulator, going back to Nasdim (remember?) days has had the balls to address the […]

Stamp duty

This Budget confirms the details of and changes to the modernised regime for stamp duty (now also, in some of the Budget Notes referred to as &#34stamp taxes&#34) which were first announced in the Budget 2002. Most of these come under the heading &#34Modernising the Taxation of Property&#34. The new regime will apply from 1 […]


“He has always been portrayed as whiter than white but, if you look at the Pru&#39s track record, he may not be as white as we are led to believe. Sir Peter Davis heading the Government&#39s employer pension taskforce could be like the poacher becoming the gamekeeper.” Christopher Hind, Crossley MacKenzie “Yes. It is just […]

Investment clock economic update

In the latest Investment Clock economic update, Ian Kernohan, Senior Economist at Royal London Asset Management, discusses the implications of the US Federal Reserve’s recent hike in interest rates and upcoming French presidential election. The value of investments and the income from them is not guaranteed and may go down as well as up and […]


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