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Better Time to Invest in the TEP Market Print E-mail

TEP – 30 December 2008

New research released last week has suggested that a number of factors are combining to push the cost of traded endowment policies (TEPs) down to a record low, the Financial Times Adviser reports.

The study, conducted by Money Management, found that TEP investors are in line to receive a minimum of 97.7 per cent of their total investment in the current climate.

Furthermore, it claimed that this figure can be attained without any dependence upon additional bonuses in the remaining years of a policy or a final bonus when it matures.

The research appears to back up the belief that with the current financial turmoil having a profoundly negative impact on with-profits assets, investors will be ready to pounce when the corner is inevitably turned.

Alastair Beattie from the protected asset TEP fund (PATF), said: "It has never been a better time to invest in the TEP market. 

"The low surrender values mean that anyone investing now in a fund will be in a very good position when the markets recover."

An example of such an opportunity for investors is a 25-year Royal London endowment policy, starting in 1997 and scheduled to mature in 2022.

According to the FT Adviser, it has a guaranteed sum assured of £22,970 and can be bought through the TEP market for £22,720, thus offering a 101 per cent guarantee of return.

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