View more on these topics

Woolwich Plan Managers – Woolwich Capital Growth Plan


Woolwich Capital Growth Plan

Type: Guaranteed equity bond

Aim: Growth linked to the performance of the FTSE 100 index

Minimum-maximum investment: £3,000-£500.000 Isa £7,000

Term: Six years

Return: 25% growth on initial investment or 50% growth in the FTSE 100 index

Guarantee: Original capital returned in full regardless of performance of index

Closing date: April 16, 2004, April 2, 2004 for Isa/Pep transfers

Commission: Initial 3%

Tel: 0845 070 5087

The Woolwich capital growth plan is a guaranteed equity bond linked to the FTSE 100 index for six years, providing growth of either 25 per cent of the original investment or 50 per cent growth in the index.

HHPG director Mike Gilbey thinks this is a well presented product that should do well in the current market place despite its lack of bells and whistles. He says: “The Woolwich capital growth plan is highly suited to the current market sentiments for those looking for medium-term, lower risk capital growth &#45 for example, school fees planning or supplementary lump sum retirement planning. The literature has a nice &#39comfortable&#39 appearance and the presentation is very good, with clear risk warnings without being alarmist.”

Gilbey notices that the important dates are clear and thinks that even the small print is not that small. However, one criticism he makes is that the literature is a little too much, with numerous repetitions. On the other hand he sees some merit in this allows for easy referencing when presenting or dipping in and out of the literature.

Gilbey is also critical of the 12 month averaging which he says is unduly long in the current economic environment. He explains: “The final 12 months have potentially the best growth prospects and should be maximized. While some averaging &#45 say over the last three or six months &#45 is desirable to minimise the effect of a sudden stock market crash, 12 months of averaging is unduly pessimistic bearing in mind the protected nature of the product.” He also thinks the literature could provide a better explanation of how the product works.

Gilbey mention early partial encashment is not allowed and feels the affect of an investor&#39s death is glossed over. He adds: “Partial encashment flexibility can be overcome for larger investments by making multiple applications but death is difficult to overcome. Both could be better presented with some worked examples.”

Looking at how this product will fare compared to its competitors Gilbey says: “There is a rush of similar FTSE 100TM tracker products currently available which are targeting the Isa season. Some of the Woolwich&#39s competitors, such as Nvesta offer 105 per cent of FTSE 100 index returns to partially compensate for loss of dividend income and an early close option. The early close feature is highly attractive to lower risk investors and appears in many products now. In addition there are the life assurance-based secure and protected funds all competing for the capital growth funds currently available.

“The more interesting competitors are those currently offering a combination of indexes to track, for example the FTSE 100 and Halifax House Price indices, such as the new GE Life capital secure investment plan. The idea appears to be to try to offer negatively correlated asset classes to provide a quasi portfolio structure in one product.”


Suitability to market: Average
Investment strategy: Average
Charges: Average
Adviser remuneration: Average

Overall 7/10


Call our hotline for a fair deal

The second phase of the Money Marketing Fair Deal for IFAs starts this week. In response to calls from advisers, we are aiming to compile a list of the worst offenders among the companies on admin in the last six months. Some of the complaints about companies have been a regular feature on the letters […]

Product matters

The VCT market will be fairly small this year, hence the preponderance of small top-up VCTs rather than brand new launches. Electra Kingsway is fairly typical of this and is looking to raise just over £2m. First, I would say that this is entirely sensible. I would find it difficult to back a new launch […]

Breakfast with Butterfield

Butterfield Private Bank is holding a series of breakfast seminars for advisers keen to discover more about how its services can augment their businesses. The seminars will focus on how working with the bank can help advisers “secure future success” with services such as bank accounts, lending, specialist pensions services and offshore services up for […]

Royal London welcomes Government reviews

Royal London has welcomed the Government&#39s move to commission two independent reviews in the wake of the Penrose Report believing it will go some way to restoring consumer confidence in the industry.It says it recognises the importance of a review of the actuarial profession, including the Government Actuary&#39s Department, saying sound actuarial management and prudential […]

Europe: Volatile share prices create opportunities for long-term investors

Mark Page and Laurent Millet, managers of the Artemis European Opportunities Fund, look at why, how and where fluctuations in European markets can generate opportunities for their fund. When asked what the stock market would do next, John Pierpont Morgan is reported to have replied that “it will fluctuate”. His (apocryphal) answer proved accurate. Over […]


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 thought leadership.

    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