Scottish Equitable is introducing a corporate bond option as part of its Performance bond investment fund range.
The option is aimed at cautious investors looking for better returns than available from deposit accounts.
The extra-income corporate bond fund will sit alongside ScotEq's existing fixed-interest funds which invest in a range of foreign government securities and UK gilts.
The fund invests in the higher-quality end of the corporate bond market, only trading in bonds issued by companies with Standard & Poor's and Moody's credit ratings of between BBB and AAA.
ScotEq says stockmarket volatility has increased the popularity of corporate bonds. The fund invests 32 per cent in long-dated bonds, 28 per cent in short-dated bonds and 40 per cent in medium-dated bonds.
Marketing communications manager (personal investments) Steven Whalley says: “Investors are looking more towards fixedinterest products. We are aiming at the higher end of the corporate bond market, which lowers the risk rating of the fund. This corporate bond fund is extending the choice we can offer IFAs and their clients.”