Wesleyan, a specialist financial mutual for doctors, dentists, teachers and lawyers, defied the 2018 market downturn by delivering a gross annual increase to pay-outs of 6.6 per cent to customers invested in its flagship With Profits Fund.
Wesleyan investors received this return, expected to be market-leading, principally because of smoothing – a key feature of with-profits investments. The With Profits Fund itself showed a small negative return, in line with industry trends, due to the volatility of the stockmarkets.
Robert Vaudry, Chief Investment Officer at Wesleyan, says: “Pay-outs from Wesleyan’s With Profits Fund have significantly outperformed both equity and bond markets in 2018.”
“One of the key benefits of the With Profits Fund is that we are able to smooth the return for investors, which long-term investors can find attractive, especially when markets are as volatile as they have been. By holding back some of the potential returns when markets outperform, a with profits fund with a financially strong provider can provide a higher return for investors even during a protracted downturn.”
A total of GBP10,000 invested in Wesleyan With Profits ISA five years ago would now be worth GBP13,741, while the same amount invested in a typical managed fund would be worth GBP12,382.