Zurich is offering investors another chance to invest in a capital-protected bond that is linked to the FTSE 100 and Halifax House Price indices for five years and six months.
The select guaranteed account issue 2 is available to those with between £2,500 and £250,000. Investors decide whether they to link their capital to the FTSE 100, Halifax House Prices index or a combination of the two. If they choose a combination of indices they decide how much to invest in each element. In addition to a full capital return, investors will receive 100 per cent of the growth in their chosen index or indices.
When calculating the returns, the closing level of the FTSE100 is recorded on October 29, 2004 and the non-seasonally adjusted Halifax House Prices index for October 2004 will be used as a starting point. In both cases, these figures will be compared with an average produced over the final year of the term.
This product is currently the only product of this type, although both Newcastle and Skipton building societies provide exposure to the Halifax House Price index. Skipton's guaranteed triple asset bond is linked to the same indices as the Zurich product for five years, but is not directly comparable in that some of the original capital is placed in a fixed-rate high-interest account to provide income.
Newcastle's five-year guaranteed property options bond does not provide exposure to the FTSE 100 index, so again it does not provide direct competition to the Zurich product. However, investors who are looking for a product linked only the Halifax index may opt for Newcastle's offering rather than Zurich's if they want 100 per cent of the growth in the index over a slightly shorter term.