On the back of its existing Aviva Investors defined returns and structured returns ranges, Aviva Investors has now added a defined growth range and, as with many recent launches into the UK intermediary market, the Aviva Investors Defined Growth Fund 1 provides exposure to the performance of the FTSE 100.
Unlike some of these recent launches, it does not invest directly in stocks but gets its credit exposure through derivatives. It will diversify risk by investing equally across six counterparties who are Abbey National Treasury Services, Barclays, HSBC, Morgan Stanley, Royal Bank of Scotland and UBS.
The product itself will provide investors with 8.5% for each year the plan is held – it has an auto-call triggering an early maturity form its second anniversary onwards – though this is not a compound rate.
Capital protection is only offered if the FTSE 100 does not fall by more than 50% during its five-year term.
