Legal & General Fund Tracker Capital Guaranteed Bond
Legal & General has launched a new style Capital Guaranteed Bond, The Fund Tracker Capital Guaranteed Bond 1 with a choice of two options. Either 100% participation or a set minimum return.It's available from Monday 14 September 2009 for a limited eight-week offer period closing Friday 6 November 2009. Both investment options are guaranteed as they are held on deposit by Investec Bank plc.
The Fund Tracker Capital Guaranteed Bond 1 - Option 1 is a fixed term deposit plan with a life of five years. It guarantees original capital and provides 100% participation linked to the performance of the Legal & General (Investec) Money Builder Fund. Performance is linked to the change in price of the standard units over the fixed term.
The Fund Tracker Capital Guaranteed Bond 1 - Option 2 is a fixed term deposit plan with a life of five years. It guarantees original capital and provides the greater of a 10% minimum return or 75% participation linked to the performance of the Legal & General (Investec) Money Builder Fund. Performance is linked to the change in price of the standard units over the fixed term.
The Legal & General (Investec) Money Builder Fund invests 60% in the Investec Cautious Managed Fund, and 40% in the Investec Target Return, with investment in the Cautious Managed Fund permitted to rise to a maximum of 70%. This combination effectively allows investors to tap into three investment strategies - fixed income, equities and absolute return - which, when combined, aim to produce enhanced risk adjusted returns. The Investec Cautious Managed Fund is designed to provide low to medium risk exposure to quality equities and bonds, and focuses on the long-term potential of undervalued stocks. The Fund aims to smooth investment returns through active management and focuses on diversification by asset class, sector and stocks. The Investec Target Return Fund aims to deliver steady gains over the long term through wide diversification of risk and a high level of investment flexibility. Its aim is to achieve positive returns over the long term regardless of market conditions, measured against a cash benchmark.
Legal & General's Business Development Director, Savings, Jamie Vale said "The two Legal & General Capital Guaranteed Bond investment options offer investors the excellent opportunity to benefit from greater potential returns on capital over the medium to long term available through investment in The Fund Tracker Capital Guaranteed Bond 1. And we believe that tracking performance of the innovative Legal & General Money Builder (Investec) Fund will prove an attractive proposition for cautious investors. Advisers can offer their clients a choice of maximum growth potential with option 1, or a set minimum return in option 2. Both are designed to suit clients seeking a capital guarantee at a time when many investors have concerns over financial security".
The minimum investment is £500. The total amount that individual cash ISA investors could pay into the Fund Tracker Capital Guaranteed Bond is £3,600 (£5,100 from 6 October 2009 for savers over age 50 at 5 April 2010). There is a maximum of £50,000 for ISA transfers and direct deposit investments.