Barclays Wealth launches funds for cautious investors
Barclays Wealth Investments has launched two funds linked to the Barclays FTSE 100 Trend Total Return Index incorporating a strategy to protect investors in upwards and downwards market trends.
Richard Henry, director of investor solutions for Barclays Wealth, unveiled the IFSL Barclays FTSE 100 Trend fund and the IFSL Barclays FTSE Protector 80 Trend fund.
Both aim to identify if the market is in a positive or negative trend, and once identified examine market volatility and defines the level of exposure to the underlying index within a range of 0 per cent to 100 per cent.
The final stage is specific to the individual funds. The IFSL Barclays FTSE 100 Trend fund employs a "smart stop feature" that aims to insulate investors from significant market falls through a defensive allocation to cash if the Index experiences a fall of 2.5 per cent or more over a five business day rolling period.
Mr Henry said the IFSL Barclays FTSE Protector 80 Trend fund will appeal to more cautious investors, allocating between the strategy and cash depending on market conditions. The fund will be run with the objective of protecting 80 per cent of the highest net asset value price.
He said: "The funds' potential to deliver stable, positive returns whether the market direction is upwards or downwards make for an attractive proposition as markets continue to exhibit uncertainty."
Since being seeded in September 2010, the Trend 100 fund has delivered a performance of 10.6 per cent to the end of April and the Trend 80 Fund has delivered a performance of 8.8 per cent.
The annual management charge is 1.15 per cent with a minimum investment of £1000.
Jason Butler, partner of London-based Bloomsbury Financial Planning, said: "All these banks do well but there is a risk that if you keep switching out it may depress returns in the long run."