VIRGIN Direct is calling on investors to exercise caution when choosing UK corporate bonds, following a survey conducted on 41 funds in the sector.
The Virgin Direct study looked at corporate bond fund quartile performance over five rolling 12 month periods between 1995 and 2000.
The survey found that more than two thirds of corporate bond funds with a five year performance record, had an average annual quartile ranking of more than two, indicating a high degree of volatility.
Only seven out of 41 funds consistently had a quartile ranking of less than two.
Virgin Direct claim these results highlight investing in UK corporate bond funds can be a rollercoaster ride and that investors don't fully appreciate the risks they might be taking.