Prudential has added the Pru Fund cautious series to its flex- ible retirement plan and is offering pension savers a five-year capital guarantee.
The company launched the cautious fund, to sit alongside Pru Fund growth, in July for risk-averse investors worried about moving back into equities.
The fund invests 70 per cent in nominal assets such as bonds and cash and 30 per cent in equities and was available to onshore investment bond customers from launch. Offshore cust- omers got access to the fund in September and it was made available to flexible retirement plan customers last week.
The cautious fund, which offers smoothing, has gained around 2.5 per cent since July. The flexible retirement plan now offers 163 funds although a Sipp option allows wider choice.
Director of investment funds Andy Brown says: “We launched the cautious fund because we had found in the early part of this year that some investors were worried about moving back into equities.
“While smoothing reduces volatility, for those ultra-cautious investors, we can guarantee their capital for five years. Around 30 per cent of our onshore investment bond customers have taken this option.”