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With-Profits Bond

   Also found in: Wikipedia 0.01 sec.
With-Profits Bond
A fixed income investment based on non-fixed income instruments. For example, one may purchase a with-profits bond with a 5% annual return, but the money one invests is placed in stocks, mutual funds and other instruments. The profits made in the "good years" are not disbursed to the investor; rather, they are used to make up for losses in the "bad years." These instruments are designed to allow one to take advantage of market movements without assuming too much risk. With-profits bonds are sponsored by insurance companies.


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If we take two hours looking in detail at a with-profits bond, before advising a client whether or not to sell, that would cost about pounds 300," he says.
SHARING IN THE RECOVERY Over the last few years the stock market has recovered impressively but many investors have asked why their With-Profits Bond hasn't kept pace with this recovery.
The insurer, part of the HBOS group, said regular bonuses paid on most of its with-profits bonds would be cut from 2.
 
 
 
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