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Because Investors' requirements are rarely the same.
The Guaranteed UK Selected Growth Fund (June 2008 Series) satisfies the needs
of a wide range of investors from cautious investors, who wish
to invest with the peace of mind of a 100% Capital Guarantee and who wish
to enjoy in addition a level of stockmarket growth, through to more confident
investors, who wish to access higher levels of potential stockmarket
growth but who also want to invest with a known minimum future capital
return.
Features
- A choice of capital guarantee levels from 85% to 100% of your original
investment.
- Equity growth linked to the average growth in the UK Stockmarket.
- Unlimited upward only investment growth.
- 3 year investment period.
- 6%pa interest paid during the offer period.
- Minimum investment: £5,000 Sterling.
- Next Closing Date For Applications: Monday 16 June 2008
How The Fund Works
"Select the level
of Capital Guarantee required and enjoy in addition unlimited,
risk free, upward only, stockmarket linked investment growth".
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| Fund Versions |
| Capital Guarantee Selected |
Equity Growth Percentage |
| 85% |
180% |
| 90% |
140% |
| 95% |
100% |
| 100% |
60% |
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This Fund achieves investment growth through an underlying investment
link to the FTSE 100 Index. The Fund incorporates two guarantees and your
Total Repayment is the sum of these two guarantees. The Capital Guarantee
you select is applied to the full amount you invest at the start of the
Investment Period. This is your Capital Guarantee Amount and represents
your minimum Total Repayment. To the Capital Guarantee Amount is added
the Equity Growth Amount. The Equity Growth Amount is the Equity Growth
Percentage (shown in the table above) corresponding to the level of Capital
Guarantee you select multiplied by the Index Growth, which is the average
growth in the FTSE 100 Index (the “Index”) over the three year Investment
Period, applied to the full amount you invest at the start of the Investment
Period. One effect of averaging is likely to be to constrain the final level of the Index although this is balanced by offering higher Equity Growth Percentages than would be available if a single Index level at the end of the Investment Period was used to calculate the Total Repayment.
Worked Example
If a Capital Guarantee of 85% is selected with the corresponding
Equity Growth Percentage of 180% and the average growth in the Index over
the Investment Period is 30%, the Equity Growth would be 30% x 180% which
equals 54%. Add to this the 85% Capital Guarantee and the Total Repayment
in this example is 137.5%, so the investor will receive back 137.5% of
the amount invested. In this example the high growth reward of stockmarket
linked investment is achieved whilst at the same time capital protection
is provided over the Investment Period.
The Effect Of Index Movements On The Investment
Return
The chart below shows the range of Total Repayments where the Index Growth
is between -20% and +50%. The range of Index movements shown is for the
purpose of illustration only and the Index may fall or rise by more than
the amounts shown.
The chart shows that:
- The minimum Total Repayment is the Capital Guarantee Amount
selected.
- At all levels of Capital Guarantee selected there is no cap
or upper limit on the potential returns.
- The lower the Capital Guarantee selected the higher the total
potential return.
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