L&G (N) Target Return Trust
Launched 17 January 2005
What are the aims of the trust?
This trust aims to deliver long term capital growth which exceeds the Bank of England's base interest rate as set by the Monetary Policy Committee or successor bodies.
It principally invests in fixed interest securities (corporate bonds and gilts), UK and overseas equities and cash. The manager retains the flexibility to invest up to 100% of the fund in approved money market instruments, cash or near cash assets.
The fund manager's current performance target is to exceed the Base Rate by 2.5% a year before charges. While the aim of the trust is to deliver growth that exceeds the Base Rate, the fund manager's target may also change in the future. There is no guarantee the manager will achieve this target.
- it's designed for cautious investors who are looking for a low risk investment fund
- it targets steady growth for your investment
- part of your investment can be held in cash, reducing the risk or preserving growth
- no upfront charges
- access to your money at any time (although you should aim to leave your money untouched for at least five years)
- regular statement every six months on your fund's performance and an overview of the markets
- it's available to both lump sum investors and regular savers
- available as a unit trust or an ISA
- meets the Government's Stakeholder product criteria.
Your investment
The minimum investment is £20. This can be paid as a single lump sum or as a regular monthly amount.
What are the risk factors?
The Target Return Trust involves some stock market investment, so both the capital invested and the growth achieved (return) are not guaranteed in any way. However the fund offers less capital risk than investing in funds which wholly invest in shares and can be considered as a next step on from traditional deposit accounts.
Capital risk: LOW RISK
The value of your investment will vary in line with the performance of the corporate bond and equity markets in the UK and overseas countries. You could get back more or less than you originally invested.
Inflation risk
Investments included in the fund have the potential to exceed inflation over the longer term. However, the actual rate of return is subject to market variation and there is no guarantee that the money you invest will keep pace with inflation. Where your investment makes a capital loss, the real value of your loss may be significantly greater due to the effects of inflation.
Shortfall risk
The fund may not achieve sufficient returns to help you meet your specific savings goal.
Rate of return risk
You may receive no return from your investment or a lower return than you would have liked. The 2.5% target rate may decrease.
Accessibility risk
You have access to the money you invest at any time. Given potential for variation in the value of the fund and its rate of return, you must be prepared to invest your money for at least five years.
Complexity risk
Some long-term investments can be more complex than others, which is why we aim to explain things clearly, fairly and accurately.
If you think that one of the investment funds may suit your needs, but you'd also like some expert advice, please ask to talk to one of our Senior Financial Consultants. They'll be able to advise on Nationwide's full range of investment products.
What are the charges?
There is a 1.5% annual management charge on the value of your holdings which is deducted from the fund, for the first 10 years from the date of making your first investment in the fund. After that, the value of all existing holdings and any subsequent investments that you may make in the Target Return Fund will be subject to a reduced annual management charge of 1%.
For more details of the charges please refer to the Key Features document.
Who manages the L&G (N) Target Return Trust?
The Target Return Trust is actively managed on Legal & General's behalf by an experienced fund manager, BlackRock Merrill Lynch Investment Managers, one of the world's largest investment managers.
If you need advice, contact your local branch for an appointment with your Senior Financial Consultant
