Barclays launches new Target Growth Plan
Barclays has launched a new Target Growth Plan which offers a maximum 38.5% return at maturity. The product has a five year term with a minimum initial investment level of £5,640 and is available until 11th May 2012.
The Target Growth Plan has been created especially for investors who are looking to maximize growth whilst accepting risk to both their return and capital. To achieve the maximum 38.5% 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 return £13,850 at maturity. This investment can be sold before maturity but investors may receive back less than they invested irrespective of the FTSE 100's performance. It is subject to the counterparty risk of the issuer: Barclays Bank PLC.
Richard Henry, Director, Barclays, said: "Given market movements in recent months, it is understandable that certain investors question the prospect of substantive growth in the FTSE over the medium term and we have launched the new Target Growth Plan with this in mind."
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 of their initial capital returned depending on the percentage amount that the index has fallen by. The Target Growth Plan is a structured capital at risk product.
Henry continued "The investor has the ability to earn a return even if the index falls or performs modestly, and while it's important to stress that investors capital is fully at risk, this ability to earn in the event of a market fall does give the product a certain defensive appeal."