NS&I to launch new Guaranteed Equity Bond

Tuesday, 21 April 2009 12:01

National Savings and Investments (NS&I) is to launch a new issue of its Guaranteed Equity Bond on April 21st 2009.

The bond offers a gross return that matches any growth in the FTSE 100 index over a five-year term, up to a maximum of 35 per cent, with no risk to investors' capital.

For example, if the FTSE rose by 20 per cent over the five-year term, £10,000 invested would earn a gross return of £2,000 at the end of the five years.

If the FTSE rose by 40 per cent over the five years, £10,000 invested would earn a gross return of £3,500, as the maximum return is 35 per cent.

But if the FTSE falls or stays the same over the term, investors' initial capital would be returned in full.

There will also be no dividends, so investors may not get as high a return as they might through investing directly in the stock market.

Issue 17 of the Guaranteed Equity Bond goes on sale for a limited period from 21 April 21st to June 1st 2009, although it may close earlier if fully subscribed so investors are encouraged to invest early. The minimum investment is £1,000 and the maximum is £1 million (£2 million for joint investments).

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