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The new guarantee will go live on 29 September and enable PruFund investors to lock-in any growth achieved on investment over the previous five years.

It will be available to existing guarantee customers on their fifth anniversary and to new investors from the outset, with a 0.6 per cent charge a year over the initial five-year period.

Andy Brown, investment sales manager at Prudential, said: "The fund in general has proven hugely popular with IFAs and investors and has achieved £600m sales this year so far.

"We had launched a guarantee a few years ago, but it wasn't a full-time version. So far, 65 per cent of investors bought that original guarantee, and we hope to raise this percentage."

The new guarantee will be applied automatically to the investment at five-year intervals and require no action to be taken by the adviser or investor.

Trevor Cheal, director of investments at Prudential, said the introduction of the guarantee facility beyond the fifth anniversary would further increase the attractiveness of the investment, particularly in light of current volatile markets.

With regard to movements within the actual fund, Mr Brown said the company had recently purchased protection to reduce US credit exposure and had been diversifying into overseas commercial property.

Hedge funds had also become a popular asset for the fund, he added, with alternative investments now making up 4 per cent of the portfolio.