Protean Investments has launched a six-year gilt-backed bond which aims to shield investors from rising inflation and the possibility of a company default.
The RPI Plus Note carries a projected return of RPI plus 3% annually. The bond is fully collaterised with UK government debt.
Protean explains the inherent risks behind the note as benchmark-orientated rather than through exposure to a company default; “Investors’ capital is at risk only if the FTSE 100 Index halves, in which case investors will be affected by any market fall at the end of the 6-year investment term.”
Protean is sceptical on the potential of a large percentage of actively managed funds.
It adds: “The performance of many hedge and absolute return funds have disappointed and failed to justify high levels of fees.”
To receive more relevant articles like this one, why not sign up to our briefings and breaking alerts by clicking here.