Changing nature of with-profits investments

with-profits

Although terminal bonuses should increase, regular bonuses are likely to remain low so that investors should consider alternative investments such as CPPI and manager of manager funds

On the whole with-profits payouts have fallen over the last five or six years as the result of falling regular and, in particular, terminal (final) bonuses. Despite the upturn in the stockmarket over the last couple of years, the FTSE 100 Index, which can be taken as a guide to the value of equities held in a with-profits fund, was still 20% down at the end of 2004, compared to where it was at the turn of the millennium. This is the date on which most recent bonus assumptions and declarations will be based. The FTSE 100 was down 19.5% over the period 1 January 2004 to 31 December 2004, inc...