Just to remind folks out there and not to mislead by the above statement totally, the 6-8% is not guaranteed, it depends on the volatility of the currency rate.
I had gone through its prospectus, it clearly still can have zero return rate if the volatililty of the Euro/USD doesn't exceed its hurdle rate and its targer rate.
Basically this fund is unique, the Euro/USD rate up or down is not matter, the fund will make money through volatility by its option, if the volatility is high aka as mentioned 6 average best - 6 average worst (in term of % and on each monthly), while if the time dispersion rate > target rate (around 3.75 max, will only deteremine after the fund bought the option in the market) then it gives extra 5% return rate
So the total return rate of the fund = 5% + time dispersion rate - hurdle rate
if the time dispersion rate below its hurdle rate then you get zero return.
Don't get me wrong here, I am not saying the fund is good or bad, just to share some inside and details of the fund. Just the word of 'will' should be changed to 'may'.
6-8% expected return is not interesting for capital protected fund anymore. I expect higher. Last year I invested on ING capital protected fund and its return is close to 20% for 1 year. Last month, ING launch another capital protected fund targeting 20% annual return. Closing is next week.
Nov 16 2006, 10:16 AM
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