Two new products have joined the wide array vying to attract investors' funds. And it is clear that the product providers are trying to plug gaps in the market by meeting the different mix of risk and security demanded by different classes of investors. Scottish Provident has launched a new invest fund, which tracks stock market indices like tracker bonds. It offers investors a somewhat lower guarantee than the traditional tracker protect, but more scope to benefit from market growth - if indeed markets do grow. The `Global Security Plus Funds' are being promoted by independent financial advisers, Buggy McCormack Asset Management, and require a minimum £15,000 investment.
Meanwhile MMI Stockbrokers, in association with Canada Life, has launched Capital Plus and Multiplier 10 short-term investment bonds, aimed at the investor with a shorter-time horizon. Both have a term of three years and 10 months and promise a return of 100 per cent and 150 per cent respectively of stock market growth. And £3,000 is the minimum investment in what is effectively a kind of single premium life policy being promoted in association with Canada Life. The performance of both is based on a world basket of markets. An innovative feature of the MMI bond is based around what the brokers gently call "the possibility of a short-term correction" in markets. The starting fall of the bonds will be the average of the first six months - as opposed to the value on day one - offering investors protection if there is a short-term tumble.
In the longer term, of course, the value of such market linked investments will depend on the growth in the markets, no matter what bells and whistles are built in.
See also page 2.
