New Investment Plan – 8% pa even if FTSE 100 Falls By 8%

Written by Editorial Team
Last updated: 5th July 2020

…with a 6 month early maturity feature.

This new investment plan launch has a maximum term of 8 years, but will mature early (‘kick out’) at the end of each six month period (from year 2 onwards), provided the FTSE has not fallen more than 8% below its value at the start of the plan. If it kicks outs, you receive 4% for each six month period invested – equivalent to 8% per year (not compounded) – along with a return of your initial investment.

If the Index has fallen more than 8% at the end of each six months, no investment growth is paid, and your initial capital is returned in full unless the Index has fallen by more than 40% at the end of plan. If it has, your capital will be reduced by 1% for each 1% fall, and so your capital is at risk.

For those investors who are not convinced the FTSE will rise significantly in the coming years, this defensive investment could offer a competitive balance of risk versus reward.”

Oliver Roylance Smith, head of savings & investment

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Capital is at risk. This is a structured investment plan that is not capital protected and is not covered by the Financial Services Compensation Scheme (FSCS) for default alone. There is a risk of losing some or all of your initial investment due to the performance of the FTSE 100 Index.

There is a risk that the company backing the plan or any company associated with the plan may be unable to repay your initial investment and any returns stated. In addition, you may not get back the full amount of your initial investment if the plan is not held for the full term. The past performance of the FTSE 100 Index is not a guide to its future performance.

Tax treatment of ISAs depends on your individual circumstances and legislation which are subject to change in the future. ISA transfer charges may apply, please check with your provider.

Fair Investment Company does not offer advice and any investment transacted through us is on a non-advised basis. If you are at all unsure of the suitability of this type of investment, both in respect of its objectives and its risk profile, you should seek independent financial advice.