
Going for growth
With the Virgin UK Index Tracking Trust your money gets invested into shares in every one of the 700 or so UK companies quoted on the London Stock Exchange.
Your savings lock into the returns of the main UK stock market - the FTSE All-Share Index*. Because when the market's growing, you want an investment that keeps track with it every step of the way.
Other fund managers may take a more 'active' investment approach, trying to guess which shares will do best, rather than investing in the whole market. They typically charge you an extra 5% for this. However this doesn't guarantee you an extra return. Far from it. In fact, the evidence shows that actively managed funds tend to do worse than the stock market, rather than beat it. And that still applies whether the market's going up or down.
The longer the timespan you look at, the more compelling the case for tracking becomes.
We don't believe in upfront charges or bid offer spreads. With us there's just a 1% annual management fee on our Index Tracking fund and a 0.5% charge when you sell your units.
Remember, with stock market investments the value of your savings and the income you get from them can go down as well as up and you may not get back the full amount you invest. It's also worth remembering that past performance of a fund isn't a guide to how well it might do in the future. To maximise your chances of a good return you should be looking to invest for at least five years.
A halfway house
If you're not ready to invest in shares but are after more from your money than a bank deposit account would give you, it's worth considering fixed interest investments like bonds and gilts.
The Virgin Income Trust invests in some of the safest corporate bonds and gilts around, ensuring a high-interest return without putting your capital at significant risk. To pick this option, just ask us to reinvest the interest for capital growth when you fill in your Income Trust application form.
Investing for Income
Are you after a high regular income from your savings without putting your capital at too much risk? We reckon the Virgin Income Trust is the yardstick against which all other high-interest, low-risk bond funds should be measured.
Unlike funds that take great risks with your money to achieve the highest income figure they can advertise, we prefer to get the right balance between risk and return by only investing in top-quality bonds and gilts. But remember, even with these there is no guarantee you'll get back the full amount you invest.
The trust splits your money and invests half in a wide range of gilts which we benchmark against the FT-A British Government 5-15 year stock index. The other half is spread across the highest rated corporate bonds issued by many of the UK's and Europe's leading companies.
The regular interest generated by your investments is paid out to you as a six-monthly income. The Income Trust has an annual management fee of just 1%. And that's it. No other charges.
Remember, with bonds and gilts the value of your fund and the income it earns can go down as well as up on a daily basis, with no guaratees you'll get back the full amount you invest. To maximise your chances of a good return you should be looking to invest for at least five years.