Prudential Research Shows Advisers Turn To With-Profits Investments
on: May 27, 2010, 06:20 am
New research* from Prudential shows that up to a third of
advisers expect to recommend with-profits products to clients this year
with bonds the most popular.
30 per cent of financial advisers expect to advise clients to invest in with-profits
products during 2010. Of those, 63 per cent say with-profits bonds are the most
popular with clients, followed by with-profits pensions and then with-profits
Prudential, whose with-profits fund returned 18.9 per cent in 2009** and paid out £2
billion to policyholders, believes with-profits are increasing in popularity as
advisers look for investment products which aim to deliver long-term and steady
The research went on to show 82 per cent of advisers believe long-term performance
is the most important attribute when recommending investment products which reflects
the growing concern about stock market volatility - just 40 per cent of advisers say
the majority of their clients are happy to be subject to market volatility when
making investment decisions. Around 22 per cent of advisers say only a minority of
their clients are now happy to be exposed to market volatility following recent
stock market peaks and troughs.
Andy Brown, Director of Investment Funds at Prudential, said: "With-profits sales
have strengthened in the past 18 months as investors have looked for more cautious
alternatives to pure equity investment and the growing interest looks set to
continue into 2010 despite the strong recovery in the stock market.
"Clearly not all advisers are convinced by the with-profits investment story,
however not all with-profits funds are the same and it’s important that investors
are not misled by generalisations about the performance of these products. Our
consistent approach to smoothing and bonus setting has served our policyholders
well, protecting them from the full impact of volatile investment conditions while
giving them the confidence of knowing that their savings are invested in a
financially strong and well-managed Fund."
Of those advisers who would recommend with-profits to their clients, 53 per cent
said that financial strength was the most important factor when considering a
The information contained in Prudential UK's press releases is intended solely for
journalists and should not be used by consumers to make financial decisions. Full
consumer product information can be found at www.pru.co.uk.
* IFA interviews were conducted by George Street Research in March 2010. A total of
100 interviews were completed amongst a cross-section of advisers throughout Great
Britain. Quotas were imposed on the total sample in respect of size of IFA firms,
region and areas of specialisation.
** Twelve month performance to 31 December 2009
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