Income on some Isas is ˜too good to be true' warns Egg

Egg is warning investors against Isas that pay high levels of income, arguing that many are buying n...

Egg is warning investors against Isas that pay high levels of income, arguing that many are buying non-investment grade bonds, posing a threat to capital. The warning comes at a time when some fund managers are predicting defaults on many high-yield bonds as the year progresses. According to Egg research, there are currently 29 funds on the UK market yielding in excess of 7.5% and 12 funds yielding more than 10%. Rod Hudson, head of investment product at Egg, said: 'A period of sustained interest rate cutting, low inflation and weak stock markets has made the creation of 'headline wo...