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Product matters

We will all have clients who are not yet brave

enough to invest in today&#39s turbulent investment climate despite the historical outperformance from equities over the longer term.

If the current prolonged bear market has made you doubt whether this is still true, take a look at the Autif quarterly chartpack for October. I can&#39t say I&#39m a fan of investment products investing over a specific period because stockmarkets simply do not work to a pre-determined timescale but JP Morgan Fleming has gone some way to addressing this with its capital protection global growth fund.

The capital is 100 per cent protected over the five-year term,with the initial starting and finishing levels averaged out over one-year periods to help eliminate the risk of poor stockmarket timing both into and out of the product.

A further criticism I have of some “guaranteed” products is where the investment return is linked to a specified, pre-selected basket of stocks none of the constituents of which can be deselected if the fortunes of the company deteriorates.

JPMF has avoided this potential pitfall as clients&#39 investments are spread across some of the best funds from the JPMF stable, including the highly regarded premier equity growth, the AAA-rated global fixed income and South-east Asian growth funds and the European, US and Jap-anese growth funds.

This could be enough to appeal to cautious stockmarket investors whose investment goals still need to be realised whatever the state of the world&#39s stockmarkets.

Paul Illot is a senior investment adviser at Bates Investment


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