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Blue Sky Asset Management launches six per cent income plan


Blue Sky Asset Management, the structured investment boutique, has launched a plan that provides annual income potential of six per cent over five years, with a feature that can remove

Blue Sky Asset Management, the structured investment boutique, has launched a plan that provides annual income potential of six per cent over five years, with a feature that can remove any market risk to capital or income during the investment term.

The Smart Income Plan provides the potential to secure full capital protection and fixed income, in contrast to direct stock market investment, investment funds and many other structured investment products.

It provides six per cent fixed income in year one with no link to the underlying index, the FTSE 100.

Six per cent income potential is provided from year two, which is paid at each anniversary if the index is at or above 50 per cent of its starting level.

There is contingent capital protection at maturity that cannot be breached during the investment term if the index is not below 50 per cent of its starting level at maturity.

Full capital protection is provided at maturity and all future income payments are secured by an ‘activation trigger’ if the index is at or above its starting level at any anniversary from year two.

Chris Taylor, chief executive at Blue Sky Asset Management, says: ‘The hunt for viable income solutions is undoubtedly challenging advisers and investors in 2009, and is increasingly difficult in the current economic and market environment.

‘Interest rates are now close to zero, and the second quarter of the year will be characterised by a nation of savers and investors realising that the returns on their deposit accounts have fallen to derisory levels, potentially zero. Moneyfacts research now shows over 50 per cent of savings accounts are paying zero or sub 0.1 per cent interest.

‘At the same time investment headwinds have increased stock market volatility and in our view could blow traditionally popular equity income funds off course whilst also bringing more risk to newly favoured corporate bond funds than is currently anticipated. 2008 was a terrible year for equity income funds – we do not think 2009 is likely to see them fare any better.

‘The Smart Income Plan is ground-breaking and introduces a new and lower risk income Plan that can solve the dilemma for investors at this time. Wealth managers have told us that headline-rate chasing is not appropriate in the current markets and that sensible, viable, lower risk income is needed. The Smart Income Plan therefore delivers an innovative and compelling solution, with exceptionally conservative index conditions and unique duplicate methods of providing capital protection, including the unique ‘activation trigger’.’

The plan is open immediately, with a short offer period until 17 April. Isa transfers are possible until 3 April.

The minimum investment is GBP10,000 for direct investment or GBP7,200 for Isas and Isa transfers.

The plan can also be accessed through pension schemes, including Sipp and Ssas, and is available for corporate, trustee and charity investment.

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