View more on these topics

Scottish Life International serves up with-profits alternative

Scottish life International is marketing its protected bonus bond as an alternative to with-profits bonds.

The protected bonus bond is a guaranteed equity bond that is linked to the FTSE 100, Eurostoxx 50 and S&P 500 indices for a term of six years and two months. Investors are guaranteed the return of their original capital and minimum growth of 18 per cent, regardless of how the stockmarket indices perform during the term.

To calculate the returns, the closing level of each index is recorded on January 20 each year and compared with the lowest index level in the 10 days before the bond’s anniversary. If all indices stay the same or rise each year, investors get a 9 per cent return. Over the term, this gives a maximum growth potential of 54 per cent.

Some investors may be moving away from with-profits bonds because bonus rates have been reduced in recent months following poor stockmarket performance. This bond could be seen as an alternative to with-profits as it is a halfway house between savings accounts and direct investment in equities. Its main attraction is that it returns investors’ capital and provides at least 18 per cent above this whatever happens to global stockmarkets over the next six years and two months.

The long-term view it offers, as opposed to the three-year term of Royal Bank of Scotland International’s bonus builder account, also means investors are not exposed to short-term stockmarket volatility.

However, one drawback with the Scottish life International product is that as the returns are based on the movement of each index every year during the term, the structure of the bond includes two months where investors are not getting any growth.


Insight Investments – Insight Investments Global Bond

Monday, 21 October 2002 Type: Oeic Aim: Income by investing in global fixed and variable rate securities Minimum investment: Lump sum £2,000, monthly £100 Investment split: 100% in global fixed and variable rate securities Isa link: Yes Pep transfers: Yes Charges: Initial 5.25%, annual 1.5% Commission: Initial 3%, renewal 0.5% Tel: 0845 8506050

SWIP trusts beats all-share index by 28 per cent

Scottish Widows Investment Partnership has appointed Matthew Harris as investment director to its Japanese equity team. Harris, 28, has more than seven years experience managing Japanese funds at Aegon Asset Management. He will work on Japanese institutional funds with responsibility for research in both retail and institutional funds.

National Savings and Investments – Guaranteed Equity Bond Issue 3

Tuesday, 22 October 2002 Type: Guaranteed equity bond Aim: Growth linked to the performance of the FTSE 100 index Minimum-maximum investment: £2,000-£1m, £2m for joint application Term: Five years Guarantee: Capital returned in full regardless of performance of index Return: Up to 65% of growth in index Interest rate: 3.5% gross a year Closing date: […]

Two MX packages simplify sourcing of staff benefits

MX Financial Solutions is offering two new employee benefits packages, MX Flex and MX Select.MX Select allows employees to choose from a range of benefits with leading providers. Under MX Flex, employees can pick from a range of benefits paid for from an allowance allocated by the employer.Benefits available under MX Select include PHI, dental […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm