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Shepherds offers WP bond converter with 9.8% yield

Shepherds Group is offering a with-profits bonds converter that it says will provide annual returns of 9.82 per cent.

It says there are thousands of investors who need to draw an income but are stuck with a poorly performing with-profits bonds and are unable to make an exit because of a market value adjuster.

Investors who surrender their with-profits bond to Shepherds will have the value of their policy guaranteed and then invested on their behalf in a wide range of investments which are designed to reduce risk while at the same time providing an income.

Shepherds believes its converter is a solution for these investors as it still provides an income, achieves a broader spread of investments thus reducing risk, and protects the capital and the final payout of the original bond.

The firm says the converter will allow investors to almost double the size of their investments as a national bank is providing funding secured against part of the original bond&#39s surrender value.

Minimum investment for the product is £50,000. Commission is variable depending on the level of Tep purchase.

The length of the term available is between seven and 15 years.

There is an arrangement fee of 1.5 per cent and a £75 solicitor&#39s fee.

Managing director Mike Abraham says: “Many people have found that the return from their with-profits bond has effectively dried up. We are offering them the opportunity to obtain an income using their bond as a collateral investment. Additionally, their new investment has a broader exposure to risk as it is invested in a spread of companies.”

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