Abstracts » Business

Risk-averse investors shy away from bond commitment

Article Abstract:

UK corporate bond personal equity plans (Peps) were launched in Jul 1995, and have not attracted a great deal of consumer attention since that date. The bonds have been marketed as suitable for investors seeking low levels of risk and such investors tend to have little experience and do not understand the new products.First-time investors tend to shy away from complex products, and this has been illustrated by the success of the Guaranteed Bond Pep from Legal and General, which is a straightforward offering.

Analysis, Bonds, Bonds (Securities)

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Tessas: many happy returns...for some

Article Abstract:

UK tax-exempt special savings accounts (Tessas) were introduced in 1991 and have brought in some 30 billion pounds sterling, according to tax authority estimates. Some 15 billion pounds is to be to be paid out in 1st qtr 1996, and 20 billion pounds in full-year 1996. Tessas provide a tax-free income if savings are left for five years, and they are of especial benefit to people who are liable for high rates of tax. Taxation on savings will be reduced for those on the basic rate but not for higher rate payers.

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New generation Tessas: the best deals

Article Abstract:

UK tax-exempt special savings accounts (Tessas) provide a range of returns from 11,419 pounds sterling to 12,400 for 9,000 pounds invested in 1991. A high initial rate of interest did not always mean a strong performance over the full five years. Investors planning to invest in the second round of Tessas should consider a number of factors in addition to interest rates. Transfer charges may be important in case they want to move their cash. They may also gain a bonus if their provider is taken over.

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