If you are an experienced (sophisticated, high-net-worth or professional) investor looking for an investment that has the potential to offer higher returns than more mainstream products, it’s worth considering the addition of property bonds to your portfolio.
Property bonds should only form part of a well balanced and diversified portfolio, and some property bonds can be held in an Innovative Finance ISA (IFISA), which means any returns are tax-free.
The fact that property-backed fixed term bonds generally pay a stated income at fixed intervals can give portfolios a valuable element of certainty, and if your portfolio contains a number of bonds paying at different times, this has the potential to provide a fairly constant income stream.
It’s important to remember though, property bonds are an investment product, meaning your capital is at risk and returns are not guaranteed.
Property bonds can also be effective in balancing more volatile investments - such as stocks and shares - in a diversified portfolio. This becomes even more attractive if the bond can be held inside the IFISA tax wrapper.
Ultimately, it’s only you - and preferably, an independent financial advisor - who can decide whether a property bond is a good fit for your portfolio.
Your risk profile - including your investment goals, circumstances, knowledge and experience - are one of the most important considerations, and you should always make sure you’re basing your investment decisions around these.
CARLTON Bonds are an IFISA provider specialising in fixed term property bonds.
Against a backdrop of low interest rates and a volatile stock market, the IFISA can provide an attractive investment opportunity for experienced investors.
The property-backed IFISA has the potential to generate higher rates of return than more traditional investment routes for investors with a greater appetite for risk.
To find out more about property bonds, .