Participation bonds is an unearthed investment gem

The global economic downturn has resulted in investors paying closer attention to their investments and reassessing their investment strategy and as the yield on traditional investment such as bonds and equity wanes, market players in the participation bonds arena continue to deliver good returns with the benefit of secured capital investment.

According to John Field, Chief Executive Officer of FedGroup, “While participation bonds have been in operation for a number of years, investors have often overlooked it as an investment and have sought the more traditional means of investment. However, we are starting to see a positive uptake of participation bonds given the fact that our clients enjoy an investment where their capital is secured and grows steadily each month.

“In the current economic climate, investors are seeking stability of capital investment and good returns,” says Field.

A Participation Bond is a secure investment which earns monthly interest. The FedGroup Participation Bond Fund holds a diverse portfolio of first mortgage bonds over commercial and industrial properties that collectively make up the security against which each investment is made.

Part Bonds are regulated under the Collective Investment Schemes Control Act which lays down strict rules to protect your investment in the Fund. These include:

· Part Bond Managers may not lend more than 75% of the value of a property if both interest and capital are redeemed on a regular basis and not more the 66.6 percent if only interest is being repaid.

· Borrowers applying for loans are required to meet a strict set of requirements and all properties and planned property developments are scrutinized by a carefully selected team which includes financial and property professionals.

· The Act is administered by the Financial Services Board.