F&C will launch its Sterling Enhanced Cash fund next week. The fund will target SIPPs investors and will aim to generate higher returns than those generated by traditional money market funds, with an expected initial yield of around 6%.
Compared to some liquidity funds with a one month LIBID target return, the Sterling Enhanced Cash fund will aim for a three month LIBOR plus 35 basis points gross of charges, calculated on a three year rolling basis. F&C believes the new vehicle will attract interest from the SIPP market and also from high net worth individuals eager to find a better deal than those offered by some online savings accounts. The fund will have an annual management charge of 0.3%. John Yule, head of retail distribution at F&C, also expects demand from maturing pension funds moving money away from bonds int...
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