Aviva is launching a new tranche of its Guaranteed Fund on 30 November 2009. The fund is designed to provide capital growth and guarantees that the value on the fifth anniversary will be no less than the original payment into the fund.
In addition, a new feature allows customers who invest in selected Aviva bonds to switch into the Guaranteed Fund and lock in profits at the fifth anniversary. (See notes to editors*). Customers who previously wanted to invest in the fund had to open a new investment bond. Now they can switch within their existing bond.
The fund complements Aviva’s With-Profits Guarantee Fund – launched on the same day – and builds on its range of guaranteed and protected investments designed to meet demand from customers and distributors.
The Guaranteed Fund is actively managed and invests in UK and international equities, bonds, property and cash. It is available through Aviva’s Portfolio investment bond and the minimum investment is £5,000. The guarantee applies on the fifth anniversary. If money is taken out before that date, the customer may not get back the amount invested. After five years the investor must decide where to reinvest their capital.
The charge for the guarantee for the first five years is an extra 0.5% a year on top of Portfolio’s charges.
David Barral, marketing director at Aviva, said: “Aviva is now offering both new and existing bond customers something new – the ability to transfer into the Guaranteed Fund at any time.
“A simple fund switch allows bond customers investing in other funds to transfer into the Aviva Guaranteed Fund locking in growth after five-years. It’s a feature that has been developed following extensive research among customers and advisers, and is designed to help people to invest for their future.
“Customers can also lock in any gains from earlier tranches of the Guarantee Fund. The ability to switch in and out of our Guaranteed Fund at any time builds on the popularity of the fund by giving customers greater control and flexibility over their investment.”
The value of the investment can go down as well as up and if you surrender the bond before the five-year guarantee, you may not get back your initial investment.
* Applies to clients with investments in Portfolio Bond (Level and step down options). Also CGU Portfolio Bond, Norwich Union Portfolio, Bond 2000 (post July 2001) and Flexibond (post October 2000) policyholders with investments between October 1995 and July 2003 can switch into the latest available Guaranteed fund.
