Learning Material Sample
Investment and risk4.1 Asset classes - cashIn this section, we aim to understand the main features, types of potential returns, key factors affecting price, volatility, access, taxation issues and variations of cash as an investment asset class.
Providing the investment is into a recognised financial institution such as a UK bank or building society or via National Savings and Investments, any capital invest... Shortened demo course. See details at foot of page. ...p>Returns therefore can be greatly reduced if the investor withdraws funds at short notice or brings funds down to a level where a lower rate of interest is offered.In the case of cash deposits, the amount invested constitutes the “price”... Shortened demo course. See details at foot of page. ...ady to release funds should rates rise so long as they are not penalised as a result.The capital value of the sums invested into deposits do not as a rule, suffer any volatility in that the original amount will always rem... Shortened demo course. See details at foot of page. ...tion under this scheme will be limited to 100% of the first £85,000. This maximum applies per investor and not per account.
Access to capital funds is usually instant but as already mentioned, this might be at the risk of interest penalties or loss of interes...
Shortened demo course. See details at foot of page. ...ital funds is usually instant but as already mentioned, this might be at the risk of interest penalties or loss of interest altogether. UK resident holders of UK Bank and Building Society deposit accounts receive their interest payments...
Shortened demo course. See details at foot of page. ...ificate showing the gross amount of interest produced, the tax deducted and the net amount received. The accounts generally come in two forms namely, instant access or restricted access.
An instant access account can only be so named where the individual account holder is able to with... Shortened demo course. See details at foot of page. ...y high interest rates providing investors are willing to keep their funds tied up for the specified period eg 1 or 2 years. Rates can increase further where the amount invested is higher. Generally provided by subsidiaries of UK financial ...
Shortened demo course. See details at foot of page. ...K domicile/resident individual on worldwide income. On 1 July 2014, the exi...
Shortened demo course. See details at foot of page. ...ved free of income tax. National Savings & Investment (NS&I) products are Government investments which are secure and are guaranteed by the Government. They can be purchased online, by telephone or by post directly from NS&I. The products offered are all cash based and come in a variety of different structures to meet the needs of different investors.
NS&I Direct NISA The NS&I Direct NISA is available to eligible investors aged 16 or over and has the following features: Minimum cash investment of £1 required to open account and maximum limit is restricted by the maximum annual allowance for that tax year They cannot accept transfers from other providers It can only be opened and managed online or by telephone but additional funds can be added by standing order It pays tax-free variable interest Penalty free withdrawals are paid directly to a nominated bank account. NS&I savings certificates These are lump sum cash investments earning guaranteed rates of interest over a specified time period. They are available as fixed interest or index linked They can be purchased by anyone aged 16 or over, singly or jointly and by trustees The minimum investment into any issue is £100 and the maximum £15,000 However there are separate holding limits to fixed interest and index linked certificates and the proceeds of maturing savings certificates can be reinvested with no limit There i... Shortened demo course. See details at foot of page. ...ut is paid grossIncome bonds can be cashed in at any time without notice or penalty. NS&I bank accounts NS&I currently offer 2 types of bank account Investment account This is a postal only account Minimum investment is £20 and maximum is £1,000,000 Interest rates are variable Accounts can be opened by anyone aged over 16 individually or on a joint basis Parents and grandparents can open on behalf of children Can also be held in trust for not more than 2 beneficiaries Withdrawals can be made at any time without notice or penalty Interest is credited to the account without deduction for tax but is fully taxable in the hands of the investor. Direct Saver Account Can only be opened online or by phone with a debit card Minimum investment is £1 and maximum holding is £2,000,000 Can be opened by anyone aged 16 or over, individually or jointly Additional funds can be paid by debit card, standing order of bank transfer from nominated bank All withdrawals paid by BACS to nominated bank account Withdrawals can be made at any time without notice or penalty Interest is earned on a daily basis and added each 5 April Interest is credited to the account without deduction for tax but is fully taxable in the hands of the investor. What is the maximum date that a NS&I Children’s Bond can be held to? Answer : Purchase course for answer |
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