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nvesta freshens up bond theme

nvesta has established a guaranteed equity bond that pays three times the growth in the index to which it is linked.

The triple tracker plan is linked to the FTSE 100 index for a term of five and half years. Investors will get their original capital returned in full provided the FSTE 100 never falls by more than 50 per cent during the term. If it does fall by this amount, investors will still get a full capital return if the index recovers to at least its level at the start of the term.

Where this does not happen, capital will be reduced by 1 per cent for every 1 per cent fall in the index. On top of the capital return, investors will get three times the growth in the FTSE 100 index, but this is capped at 75 per cent.

This bond adds another twist on the well-worn theme of guaranteed equity bonds by offering triple the rise in the index. However, the cap on this growth at 75 per cent means investors would benefit the most if the index rises by up to 25 per cent. The cap prevents all the growth being passed on to investors if there is a bigger increase than 25 per cent.

Some bonds that have a conditional guarantee offer investors the choice of income or growth. NDF&#39s higher income & growth plan 3 is an example of this. Comparing the two products in terms of growth, the NDF product provides a lower return of up to 50 per cent and the rate of capital reduction for falls in the FTSE 100 index beyond 40 per cent is double that of the nvesta product.


Norwich Union praises Government for Sandler suite announcement

Norwich Union has responded enthusiastically to the Government&#39s decision to reconsider the price cap on the stakeholder suite of products. It believes if the price cap is lifted the products will have stronger backing from providers and a greater chance of success with the public. NU has also welcomed the endorsement of the with-profits concept […]

Backing for CML proposals

Mortgage broker MX Moneyextra Mortgages has welcomed the Council of Mortgage Lenders&#39 initiative to keep the level of house repossessions low. The company warns there will be more repossessions if interest rates rise to 6 per cent or 7 per cent. It suggest that the most practical app-roach for homeowners would be to consider how […]

Another hold-up in RJ Temple stake talks

IFA RJ Temple has suffered another delay in its search for an investor to buy a stake in the firm. The closure of a new deal was due to be announced at the company&#39s annual conference in Lon-don last week but, as part of his introductory speech, chairman and chief executive Geoffrey Morphitis warned employees […]

Treasury publishes long awaited Sandler consultation

The Treasury has published its long awaited consultation on the make-up of the Sandler suite of products, setting out the specifications for the products. The suite will include an equity based product, a with-profits product and a pensions product although the Treasury says there is a case for including other products within the suite. The […]

Benefits of using a probate bare trust

Have you ever wondered what happens to someone’s investment bond on their death if it is not written in trust? When someone dies it is essential to deal with their estate, which can be made up of their home, belongings, investment bonds and anything else they may have owned. But, it is not as simple […]


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