The guaranteed bond is a fixed term deposit plan with a life of five years, which offers 2 investment options:
Fund Tracker Capital Guaranteed Bond 2: Option 1.
Guarantees original capital and provides 100% participation linked to the performance of the Legal & General (Investec) Money Builder Fund up to a maximum of 50% of original investment. Performance is linked to the change in price of the standard units over the fixed term.
Fund Tracker Capital Guaranteed Bond 2 – Option 2.
Guarantees original capital and provides the greater of a 10% minimum return or 60% participation linked to the change in price of the standard units of the Legal & General (Investec) Money Builder Fund over the fixed term.
For both investment options capital is guaranteed as they are held on deposit by Investec Bank plc.
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%.
Legal & General’s Business Development Director, Savings, Jamie Vale said:
“In the current economic downturn many investors have concerns over financial security. Our Guaranteed Equity Bond is designed to meet the needs of advisers whose clients are seeking an opportunity to benefit from greater potential investment returns over the medium to long term with the security of knowing their capital is guaranteed.
"Advisers can offer their clients a choice of maximum growth potential with option 1, or a set minimum return in option 2. And by tracking performance of the Legal & General Money Builder (Investec) Fund we have added an extra reason for cautious investors to be attracted to this innovative proposition.”
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 for savers over age 50 at 5 April 2010). There is a maximum of £50,000 for ISA transfers and direct deposit investments.
Fund Tracker Capital Guaranteed Bond 2 pays commission to advisers of 3 per cent of the sum invested (no commission on moving from existing Legal & General investments). Advisers who would like more information on this product should contact their normal Legal & General representative or call 0845 070 6452. Lines are open from 09.00 am to 5.00pm Monday to Friday. Call charges will vary. We may record and monitor calls.
