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Zurich Financial Services has linked with Barclays Capital to create a market first for 2003
15th January 2003: Zurich Financial Services today announces the launch of the market's first continuously available Protected Profits fund. The new fund provides investors with a unique combination of exposure to equity markets, together with the ability to switch in and out of the fund at any time. It will be available initially through Zurich's IFA investment brand, Sterling.
Developed in response to volatile investment markets and consumer demand for more cautious investment options, the fund's value will not fall lower than 80% of its highest ever value. The new fund has been developed jointly with Barclays Capital who have provided invaluable investment expertise and who will also play a key ongoing role in the provision of the protection. The fund's flexibility allows investors to switch into and out of the fund at any time across all Sterling products and full Sterling fund range*. Most other 'protected' investments usually restrict investors with tranche-based products whereas this fund does not confine investors to minimum investment periods.
Other Key Features:
- No Market Value Reductions (MVR) or lock-in period**
- No fixed maturity date
- Transparent with clear and simple charging structure and prices published daily
- Switching - the fund's flexibility allows investors to cash in, or to switch into and out of the fund at any time, free of charge, within all Sterling products and fund range, although excessive switching may be charged for
- Continuous protection
Kevin Ronaldson. Marketing, Customer and Communication Director of Zurich's Life Business in UK, Ireland and International said:
"We have developed the only continuously available protected fund in the market that allows cautious investors to dip a toe back into equities. It's particularly appropriate for investors keen to take advantage of improving market conditions but wary of ongoing volatility normally associated with equity investments."
Sterling Protected Profits is linked to cash and three Threadneedle equity funds chosen for their size and strong performance. As the underlying Threadneedle equity funds rise, more of the Protected Profits fund will be moved automatically into them - as they fall, more of the Protected Profits fund will be moved into cash.
* Fund switching is currently free of charge but an administration charge for excessively frequent switching may apply.
** Wrapper charges may apply depending on the underlying investment vehicle chosen.
Illustrative graphs of Sterling Protected Profits fund performance are available
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Notes to Editors
- The fund is available for ISA/PEP transfers and Sterling Investment Account business from 3rd February and the Investment Bond from 17th February.
- IFAs should call ZIFA on 0500 546 546 for further information.
- Sterling Protected Profits
- Combination of three Threadneedle Asset Management equity funds and a cash fund
- Initially the weighting of the Threadneedle funds will be roughly split 60% UK Institutional Growth, 20% American Growth, 20% European Growth as the mix will change over time
- Dynamic asset allocation adjustments are made on a daily basis
- Maximum 70% equities, minimum 30% cash
- Equity proportion is typically 3.5x the difference between the current fund value and its protected level
- Unit price never falls below 80% of previous highest level
- Protection level can be higher on initial investment
- The protection is underpinned by a AA-rated large UK-financial institution
- The protection is at a fund/unit price level, not individual so that exiting investors are not disadvantaged
Threadneedle UK (Institutional) Growth Fund
- £1,135m in size
- Launched 30th September 1985
- 2nd quartile performance over 3 & 5 years
- Fund outperformed sector average by 3.4% over 5 years
- S&P AA and 4-star rating
Threadneedle European Growth Fund
- £462m in size
- Launched 30th September 1985
- 1st quartile performance over 3&5 years
- Fund outperformed sector average by 19.3% over 5 years
- S&P AA and 5-star rating
Threadneedle American Growth Fund
- £635m in size
- Launched 5 February 1968
- 1st quartile performance over 3 & 5 years
- Fund out-performed sector average by 33.3% over 5 years
- S & P AA and 4 star rating
- Note on Charges
- Extra AMCs are:
0.25% for SIML products
0.60% for bonds
- Total AMCs are:
1.75% for SIML products
1.60% for bonds
- Product wrapper charges are in addition
Zurich Financial Services is an insurance-based financial services provider with an international network that focuses its activities on its key markets of North America, the United Kingdom and Continental Europe. Founded in 1872, Zurich is headquartered in Zurich, Switzerland. It has offices in approximately 60 countries and employs well over 70,000 people.
Zurich Financial Services, (UKISA) is part of the Zurich Financial Services Group and comprises the Group's operations in the UK, Ireland and International Businesses.
For further information please contact
Zurich Media Relations on 01703 505120/503969
Or Nicky Barrett, Consolidated Communications on 020 7208 2750/2366 | 