AIG Life is to launch a managed index fund in the spring as a link to its guaranteed stock market bo...
AIG Life is to launch a managed index fund in the spring as a link to its guaranteed stock market bond, writes Leo Bland.
The product will offer access to a range of index funds run by AIG and linked to a variety of the world's major stock markets including the UK, US, Pacific Rim, Europe and Japan. Asset allocation is not being decided by an index but instead the group will be looking to take aggressive positions with market exposure. The fund will also be able to invest in cash.
Nigel Hewett, investment marketing director at AIG Life, said that the fund will be able to have zero weightings in markets which AIG does not favour. The asset allocation will be adjusted on a quarterly basis.
The indices which the managed index fund will track include the FTSE 100, S&P 500 and the Nikkei 225. A basket index is used for Europe which is made up of 25% in the DAX, 25% in the CAC 40, 15% in the Italian MIB, 15% in the Spanish IBEX and 20% in the Swiss SMI.
A basket index is also used for the Pacific Rim, which is made up of 35% in the Australian ASX All Ordinaries index, 35% in the Hang Seng and 30% in the MSCI Singapore index.
The fund, which is set to be launched in April, will complement AIG's existing global managed fund which takes positions in line with conventional UK managed funds and is also based on investments in AIG's index tracking funds. AIG's global managed fund currently has around 70% in the UK, 8% in the US, 4% in Japan and 3% in the Pacific Rim.
AIG launched six actively managed fund links for its stock market bond product last year including links to funds run by M&G, Newton and Gartmore.
The other investment houses which AIG is now linked to for the bond product are Deutsche Asset Management, Perpetual and Flemings.
The annual charges on the actively managed fund links include 0.75% from AIG with additional annual charges levied by the investment houses which range between 0.5% and 0.95%.
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