With the FTSE 100 at its current levels, investors considering their options are often split down the middle – on the one side are those who feel confident that the Index can break through the 7,000 point barrier and keep going, and then there are those on the other side who remain uncertain that the market can continue to rise. With this in mind, we take a look at a newly launched investment plan that aims to cover both eventualities, in order to find out whether this could make for an attractive opportunity in the current investment climate.
Investors looking to gain a broad exposure to the UK stock market often look to investments linked to the performance of the FTSE 100 Index. But with the Index continuing its run at historically high levels, many investors are finding it difficult to decide if now is a good time to invest or not.
For those who think that the market may either stay relatively flat or will go up in the medium term, the FTSE Kick Out Supertracker from Start Point Investments offers investors two opportunities for competitive returns.
With the new year firmly up and running, now is a good time to review those key drivers that could affect the economic landscape in the months ahead as well as consider how these might affect our savings and investment decisions. Paltry returns that struggle to maintain the spending power of our money has been the frustrating story of last year but is this set to change in 2014? We take a look at events so far this year in order to reveal what might lie in store.
Story so far
2014 has already brought us some surprises. Although the Bank of England (the Bank) base rate has remained unchanged, unemployment has been falling faster than expected and with the latest figures from the Office for National Statistics revealing inflation has fallen to its lowest level since November 2009, the year has so far asked more questions than it has answered. So what does all this mean?
The hunt for a competitive fixed income continues to intensify amidst record low interest rates, historically low savings rates, above target inflation and little in the way of economic growth. However, by combining a high fixed income with conditional capital protection, one of the real investment stories of last year seems to be particularly well placed for these economic pressures.
The Enhanced Income Plan from Investec was our most popular income investment during 2013 and with continued pressures on savers to give serious thought to what is the best home for their money, has been of interest to both savers and investors alike. To help you understand why this plan has proved so popular, we take a look at our Top 10 reasons to consider this fixed income investment.
1. Fixed income
Receiving an investment income that is not reliant on the performance of the stock market is a rare thing. However, this is exactly what the fixed income investment achieves and as the title suggest, the exact amount you receive is known at the outset. Most other income investments offer a lower yield which is variable and so the opportunity to access a healthy and predictable income stream is clearly a key feature.
2. High income
Not only is the income fixed, but it is often offered at a high level with a 5.64% yield (link) currently available. When compared to dividend yields available from many UK equity income funds, this is considerably higher although funds do have the opportunity to benefit from capital growth whilst the fixed income investment does not.
The need for high income remains firmly at the top of the New Year wish list for both savers and investors and as the hunt for high yield opportunities continues, being able to quickly understand and compare the numerous options available is still as important as ever.
To start the year as we mean to go on, we compare two of our most popular fixed term income investments with some of our best selling income funds in order to help you decide whether they might meet your income needs.
2013 – setting the scene?
If there is one thing 2013 taught both savers and investors, it is the harsh reality that the UK is still very much a part of the global financial crisis – record low interest rates, historically low savings rates, above target inflation and little in the way of economic growth. So will 2014 bring more of the same?
Unfortunately, it would appear that this will indeed be the case since there is little on the horizon that fills us with a sense that the end is in sight. A small drop in unemployment and inflation is of course welcome, but these are not the early signs of a sustained recovery and there still remains great uncertainty around what the coming years might hold for us all.
Following consultation with various stakeholders, the Treasury has announced that savings kept in a Child Trust Fund (CTF) will be transferable to a Junior ISA from April 2015 – much to the relief of many who had hoped for such an announcement in the 2013 Autumn Statement and were disappointed when this failed to materialise.
A better deal for young savers with Junior ISAs
Up to 6.1million children stand to benefit from this change, which will see them able to take advantage of the benefits offers by Junior ISAs such as better returns on their investment, lower charges, and a wider choice of products.
Junior ISAs were introduced in 2010, following the closure of the Child Trust Fund Scheme. Up to £3,840 per year can be put into a Junior ISA without tax being paid on any interest or gains. When a child turns 18, the Junior ISA account automatically becomes an adult account.