Swedish firm Skandia is marketing in the U.K. the latest tranche of its Protected Portfolio Investment, a bond issue which gives investors the choice of four levels of capital protection. Skandia is working with its parent, South African insurer Old Mutual, to offer the latest tranche of its four-year-old product.
Morgan Stanley is managing the investments on behalf of Skandia. Spokeswoman Anya Parkhouse in Southampton said Skandia decided to work with Morgan Stanley after completing due diligence, declining to give more details.
Skandia's issue tracks a basket of actively managed funds with four risk options varying from 100% protection with 100% return on the quarterly averaged growth, to 80% protection and 200% of the quarterly averaged growth. It uses a capital protected structure, supported by zero coupon bonds, and is being sold in the U.K. and to offshore U.K. residents.
Parkhouse said the different options were designed to meet the interests of different investors and added, "We would expect interest to be strong." She declined to give sales figures. The product matures in five years.
