Following an extensive consultation, the ABI has today launched a new investment fund sector, the Deposit & Treasury sector. The new sector contains funds that have capital stability as their overriding objective.
The new sector will function alongside the existing Money Market classification. Funds within the new sector can only invest in relatively simple instruments such as Government bonds or fixed term savings vehicles. All funds must invest in instruments that are denominated in sterling and have a maximum duration of 12 months. The ABI has produced a guide on the new sector for consumers and advisers at www.abi.org.uk
Maggie Craig, the ABI’s Director of Life and Savings, said: “The Deposit & Treasury fund sector has been established in direct response to consumers’ wishes. It makes things simpler through clearer labelling, helping consumers looking for funds that offer stability. Whilst no investment is risk free, this new classification should be a great help in these times of financial volatility.”
The ABI’s Life and Pensions fund sectors are a method of categorising investment funds. Each sector has clear criteria that must be followed by funds within it. There are currently 34 ABI fund sectors, with over 7,000 funds individual classified within them. Each sector contains funds that have similar investment strategies, making it easier for consumers, and advisers, to identify the funds that suit their requirements.
