Meteor launches latest plan linked to top ten blue chips

Meteor Asset Management has launched the latest version of its Kick-Out Plan range, with returns linked to the stock market performance of ten UK blue chips.

The £10,000 minimum investment Top Ten 8 Kick-Out Plan is linked to the top ten shares in the FTSE 100 as at 17 June.

At that date, these were AstraZeneca, BG Group, BHP Billiton, BP, British American Tobacco, GlaxoSmithKline, HSBC, Rio Tinto, Royal Dutch Shell A, and Vodafone.

The plan will mature and pay 16.5% at the first Annual Measurement Date (AMD) as long as the levels of at least eight of the ten shares are equal to or greater than their opening levels.

In the event that maturity is not triggered in the first year, the plan continues into year two where, if the criteria are matched on the second AMD, the plan will pay 33%.

This continues until eight or more shares are at or above their opening levels on any AMD and therefore would pay 49.5% in year three, 66% in year four, 82.5% in year five and 99% in year six (at maturity).

If the plan has not matured early and the final levels of three or more of the shares are below their opening levels, then no growth payment will be made.

Capital is at risk in the event that the plan has not matured early and the final levels of three or more shares are more than 50% below their opening levels.

Meteor says that, in this case, the capital return will be based on the share price of the third worst performing share over the investment term with capital being reduced by the same percentage the final level is below its opening level.

The securities will be issued by Rabobank, a major financial institution with a current credit rating of ‘AAA’ by Standard & Poor’s.

Graham Devile, managing director, said: “Our Top Ten Plans are proving very popular as investors start to experience returns for earlier issues. In this latest issue we have been able to improve the investment return as well offering a counterparty with the highest credit rating, ‘AAA’.

“With the FTSE currently showing little sign of growth this plan may well suit the portfolio requirements of many equity investors looking to enhance their returns.”

Meanwhile, Meteor has also launched its Prima Platinum Defensive Plan, with returns linked to the FTSE 100 and S&P 500 indices.

It offers a return of 7% for each year the plan is in force. In the event that at the first measurement date one or both indices are below their opening level, the plan continues into year two where it would pay 14%. If the criteria were met in year three it would pay 21%, 28% in year four, and 35% in year five.

Investors’ capital is at risk in the event that the plan has not matured early and the final level of one or both indices are more than 50% below their opening level.
IFA commission on this plan is 2%, and 3% on the Top Ten Kick-Out Plan.