Scottish Mutual has introduced withprofits.com, a unit-linked bond that
allows investments to be split between a with-profits fund and a technology
The technology fund focuses mainly on tech stocks in North America and can
include biotechnology, telecomms and media stocks. The annual bonus rate
for the with-profits fund is currently 5.25 per cent. Investors can take
regular income and make one-off withdrawals.
The bond aims to produce capital growth and income over the medium to long
term. Investors can choose how they want their investment to be split
between the two funds. Those who want to take a higher level of risk may
decide to invest most of their capital in the technology fund whereas
others might prefer to divide investment equally between the funds. Less
adventurous investors could opt for greater exposure to the with-profits
fund with only a small percentage in technology.
Technology is a highly volatile sector while with-profits funds are seen
as a halfway house between building society accounts and stockmarket
investments. The bond's marriage between tech and with-profits is
innovative but could be seen as a mismatch that does not meet the
requirements of either type of investor.