The Risk Guide below will assist you in completing the enclosed PIP application form and deciding which PIP risk profile is most appropriate for you.
If you are unsure which PIP meets your investment objectives, please discuss this with your Investment Manager before selecting a PIP model.
These can include cash and fixed interest sterling denominated securities issued by major governments and corporations. In addition unit trusts, OEICs and ungeared collective investments investing principally in the above are acceptable. Please note however that a high exposure to gilts and other fixed interest securities might constitute a high risk policy since their capital values and the real value of the income that they produce are affected by interest rate fluctuations and inflation
Medium risk investments may include other fixed interest investments, shares in FTSE 100 Index constituent companies, well-established FTSE Mid 250 companies (perhaps ex-FTSE 100 stocks) and where possible (e.g. where the capital commitment is great enough) a judicious spread of shares in large and medium capitalized companies, Unit Trusts, OEICs, Investment Trusts and similar packaged investments in the major western markets (UK, Europe, North America) as well as internationally diversified examples of such funds are included.
Some sector specialist, ethical and single company country funds can be used as part of a diversified portfolio. Modest portfolio allocation in smaller companies in the major western markets via managed collective investments is also acceptable.
Insurance company and investment management company managed or multi-manager products are generally acceptable, either as part of a portfolio or in isolation.
High risk covers all other types of investments not mentioned above and can incorporate weighting or even exclusive concentration on smaller capitalized or recent start-up businesses, junior markets and trading facilities (e.g. AiM and ISDX Growth) or venture capital vehicles. Collective and packaged versions of the above are acceptable as well as offshore, non-sterling denominated or hedge funds. Investments in lesser-developed markets e.g. Asian and Emerging Markets are also included.
Warrants, covered warrants (securitised derivatives), options and other forms of derivatives also come under this category and you are required to complete a further application form (available on request) to help us assess whether complex products of this nature are appropriate for you.
Investing in any asset class will involve risk at varying degrees, and this may result in you not receiving back the original amount you invested. There are many factors to consider such as timing and external financial events.
Please note that the portfolio may hold individual stocks from outside of your risk profile but the overall effect will meet the profile selected.
It is a fact of life that capital growth or a higher income return can only be achieved with some degree of risk. The greater the potential growth or income yield, the higher the risk will be. We suggest that you think about the risks inherent in the investments you are making and in very broad terms, for your guidance we classify the three major risk categories as follows:-
The risk profile of each PIP has been determined by a number of factors including the combination of funds and the strategy employed by the investment manager and the respective fund managers. The Conservative Managed PIP may not have a 50/50 split of low and medium risk investments and in isolation some of the funds or their underlying investments may not be classed as low risk.
We make every reasonable effort to ensure that your investments meet with your risk requirements. At the time of investment our understanding and the market’s opinion in general of a security’s risk category will be applied as per your answers on the investment questionnaire. The quality of our service is dependent on the accuracy of the information you provide us with. If you fail to disclose material facts about yourself or supply information that is inaccurate this may compromise the suitability of our services. It is therefore vital that you provide us with a comprehensive and accurate picture of your circumstances and requirements.