Counting the cost of a high income

Article Abstract:

UK investors should be wary of investment products offering a high income since this could mean that capital growth is affected, and the capital may even be eroded. Corporate bond personal equity plans offer a high income and are likely to be popular in 1996, but those offering very high incomes are also likely to involve risk. Older investors may seek income rather than capital growth, as with annuities. Investors should compare yields of investment products and ensure they understand how the product works before committing themselves.

Yield-line analysis, Yield line analysis

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A question of capital

Article Abstract:

Investors can obtain higher returns from long-term investments which involve some risk. Investors seeking an income may sacrifice some of their capital. Risk levels vary according to the type of investment, with cash having a low risk and ordinary shares having a higher risk. Investors should take the impact of inflation into account when extracting an income. They should also bear their tax position in mind, since some types of investment are less suitable for investors who do not pay tax.

Evaluation, Investments

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Trackers appeal lies in its simplicity

Article Abstract:

Investors interested in units trusts can select a tracker fund as a way of avoiding the risk of a serious underperformance. Index tracker unit trusts were launched in the UK in 1988 for private investors, and became popular from 1995 with the launch of a Virgin Direct tracker fund. Additional tracker funds have been launched in 1996. Trackers vary in terms of which indices they follow and there are trackers for small firms as well as larger companies.

United Kingdom, Mutual funds

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