HSBC enhances the features on its capital protected plan

HSBC has launched the latest issue of its popular Capital Protected Plan. Designed to give people the opportunity to invest in the stock market without any risk to their original capital, the latest version comes with the added benefit of an early release trigger should the stock market perform strongly in the first three years.

For a minimum investment of £3,000, issue two of the Capital Protected Plan offers a combination of 100 per cent capital protection with 135 per cent of any growth in the FTSE 100 Index after a six-year period. It is the ideal investment opportunity for those who recognise there is value investing in the stock market, but are understandably nervous about investing directly.

As an added incentive, a new feature has been incorporated that will trigger the investment to mature early if the FTSE 100 Index grows by 30 per cent, enabling investors to profit from strong stock market growth sooner rather than later. The early maturity trigger works as follows:

On the third anniversary, if the FTSE 100 index has grown by 30 per cent (or more) above its initial level, investors will automatically receive the full value of their original investment plus 30 per cent.

Malcolm Prince, head of multi-tie investments at HSBC comments: “The terms available on the latest issue of our Capital Protected Plan are outstanding and this overall product package is a first for the market. The early release trigger has proved a popular feature with our customers in the past because it enables them to enjoy the early benefits of strong stock market growth without having to wait for their investment to run its course.”

HSBC will make a one-off initial charge of seven per cent; no other fees or annual charges are applicable thereafter. Further returns are based on the full amount invested, in addition to accepting ISA allowances, and liable to Capital Gains Tax (CGT) rather than Income Tax.

Mr Prince continues: “CGT allowances recently increased to £9,200 for single investors and £18,400 for joint investors, which is a superb incentive for people to make the most of tax-efficient investments. However, less than one per cent of the adult population currently utilise their annual CGT allowance. We hope that the enhanced terms on our Capital Protected Plan will go some way to redress this figure.”