Barclays Wealth launches new target growth plan
Barclays Wealth has launched a new Target Growth Plan which offers a maximum 21% return at maturity. This new Target Growth Plan is open to investment until 20th April 2012 and aims to offer an attractive return particularly set against the current low interest-rate environment. The product has a three year term and the minimum initial investment is £5,500.
Offering a potential return of 21% the Target Growth Plan has been created for those investors who question the medium-term growth prospects for the FTSE and at the same time seek to strike a balance between risk to their capital and overall return. To achieve the maximum 21% return, the FTSE 100 Index must either be at or above its initial level at maturity or alternatively never fall below 60% of the initial index level at close of play on any day over the term of the investment. If these conditions are met, an investment of £10,000 would give a return of £2,100.
Should the FTSE index level fall below 60% of the initial index level at the close of business on any day, and at maturity is not equal to or greater than its initial index level, both the return and initial capital will be reduced by the percentage amount the final FTSE index level is below its initial level. If this occurs, investors may still receive a level of return or all their initial capital returned depending on the percentage amount that the index has fallen by. On an investment of £10,000, the index level would, on maturity, need to have fallen by more than 17% for an investor to receive less than then the initial amount invested. The Target Growth Plan is a structured capital at risk product.
Richard Henry, Director, Barclays Wealth, said: "Given the market movements we've seen in recent weeks, it is understandable that some investors question the prospect of substantive growth in the FTSE 100. The Target Growth Plan may suit such investors in that it aims to deliver a competitive return even if the FTSE 100 falls by up to 40% during the term"
He continued "While it is important to highlight that investors capital is fully at risk in this product, the ability to deliver a return if the market falls does give the product a certain defensive appeal."