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The attraction of opposites

Scottish Mutual has introduced withprofits.com, a unit-linked bond that

allows investments to be split between a with-profits fund and a technology

fund.

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&#39s 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.

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