Ftse Growth And Guaranteed Equity Bonds

Learn about how the Guaranteed Equity Bonds or GEB works as it is indexed to FTSE growth and earnings

FTSE growth actually refers to the movement in the index. Normally there is major growth when the FTSE 100 index increases in point value. An Investment Builder Plan is basically designed to lock in stock market gains while simultaneously providing protection against a loss in initial capital invested.

Unfortunately the existing global financial climate has forced not only the FTSE growth to be stunted but has curtailed the recent rise in the Dow Jones Industrial Average. This means that a GEB or what is known as a Guaranteed Equity Bond is indexed to the FTSE growth on the index. Undoubtedly this is an excellent opportunity for investors to profit from outstanding returns and at the same time obtaining reassurance in the stock market, and if the market collapses your capital is protected.

Returns on Guaranteed Equity Bonds are directly linked to the financial performance of the FTSE 100 index. This means the FTSE 100 index rises over the specific term as the investor you will benefit from the market growth. What makes the investment so attractive is that you will receive all of or 100% of your original investment, hence the guarantee.

The most notable aspect of the FTSE growth with the GEB is that they are long term investments. These last between 60 months and 72 months and depend on whether the FTSE increases or decrease in index totals.

There are several options that exist:

A 125% GEB figure means that the specific investment will actually have a return equivalent to the FTSE growth of the 100 index over the 60 month term. Also in addition there are additional 25% earnings on the FTSE 100 index.

A 100% Guaranteed Equity Bond figure means that the investment has a return synonymous to the exact FTSE growth over a 5 year term. In addition extra 10% earnings on the FTSE 100 index.

There is several FTSE growth Bonds:

110% Bond lasts for 5 years returns equivalent increase and 10% extra.

All the bonds follow the same terms, 100% minimum returns on the increase and the additional extra as a bonus on the investment. What is even more beneficial is the fact that there is no upper limit on the returns generated by the FTSE growth bonds.

There are numerous Guaranteed FTSE growth plans issued by investment firms, some with limits and others without. One popular one is the NS&I Guaranteed Equity Bond. The fundamental features include a 5 year investment, with 0 fees and/or charges. What is important is that the investment borders on a minimum of USD$1,000 and a maximum investment of USD$1,000,000 (however investments of up to 2,000,000 can be made jointly) offering a gross return that matches the FTSE growth up to a total of 70% over the life of the investment. A guarantee that clients initial investment will be recovered at the end of the term, despite of the FTSE performance.

[tags]ftse growth,guaranteed equity bonds,ftse 100 index,GEB[/tags]