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Transcript of Old mutual training
INTRODUCING THE OLD MUTUAL INTERNATIONAL INVESTMENT
PORTFOLIO FROM OLD MUTUAL ISLE OF MAN
Rakesh JhunjhunwalaPreeminent Indian value investor
A good investment vehicleshould offer the sameadvantages as a traditionalspice box … it should housea wide range of individual,complementary assets – andoffer the possibility of new andpotent combinations.
INVESTMENT PORTFOLIOPEDIGREE
INVESTMENTACCOUNTSINGAPORE
COLLECTIVEREDEMPTIONBONDU.K.
EXECUTIVEINVESTMENTBONDHONG KONG
COLLECTIVEINVESTMENTBOND U.K.
EXECUTIVEINVESTMENTACCOUNTSINGAPORE
EXECUTIVEREDEMPTIONBONDWORLDWIDE
EXECUTIVEINVESTMENTPORTFOLIOLATIN AMERICA
EUROPEANEXECUTIVEINVESTMENTBOND)
EXECUTIVEINVESTMENTBONDWORLDWIDE
SPANISHCOLLECTIVEINVESTMENTBOND
INVESTMENTPORTFOLIOSOUTHAFRICA
INVESTMENT PORTFOLIOPEDIGREE
£600,000,000STRUCTUREDPRODUCTS
303,000TRADES43,000POLICIES
No.1£800,000,000EQUITIES
£1,500,000,000
CASH10,000‘OTHER’ ASSETS
£100,000,000FIXED INCOME BONDS
20%+
15,000COLLECTIVESAPE£130,000,000
1000+ ASSET REVIEWS
98%34,80
0ADMIN QUERIES
£10,0
00,0
00,0
00 A
UM
OPTION TOCONSOLIDATE
EXISTING ASSETS
BENEFITS
ADMINISTRATIONCONVENIENCE
TAXEFFICIENCY WIDE ASSET
CHOICE
CURRENCY CHOICE
TAXBENEFITS
NO TAX ADMINISTRATION• Old Mutual is responsible for all reporting obligations, not
the investor.• Share purchases/sales no longer need to be accounted for
in annual returns, neither any currency gains/losses.
LOWER TAX RATE• Old Mutual is responsible for paying all taxes.• OMIOM pays tax according to section 29A,”four fund
approach”• Tax rate applicable to OMIOM 0% vs 13,3% CGT, 40%
income tax.
TAXBENEFITS
No wrapper Wrapper
Capital 100,000 100,000
Growth 10% 10,000 10,000
CGT 13,3% 1,330 0
End year 1.Tax vs Fee
1,33% 0,35%-0,6%
Growth 20% 20,000 20,000
CGT 13,3% 2,660 0%
End year 1.Tax vs Fee
2,66% 0,35%-0,6%
ADMINISTRATIONBENEFITS
• Old Mutual not involved in day to day portfolio activity.• All deal instructions placed directly with stockbroker.• Valuations and deal confirmations come directly from stockbroker• Stock transfers available.• Reporting currencies include, GBP,USD,EUR,CHF,AUD.• Can appoint third party DIM• Custodian account opened in the name of Royal Skandia
OLD MUTUAL INTERNATIONALINVESTMENT PORTFOLIO
• Provided by Old Mutual Isle of Man• Sinking fund – 99 year term, maturity value of fund or
£100• Available to• individuals (joint/multiple contract holders)• companies• an individual trustees or a corporate trustee• Can accommodate asset swaps
• £100,000 – 150,000 for USD, EUR, AUD, CHF• £50,000 for top ups• Beneficiary nomination for ownership, avoids lengthy
probate.
Section 54
•Issue up to 1000 policies•Minimum per policy GBP500•Minimum payment or withdrawal amount GBP500•Investment review and and Discretionary Manager fees are partial withdrawals. OMIOM purely facilitate payment. •Each payment will lock at least one contract.To reduce the impact• co-ordinate payments • reduce frequency• use up all commission
Maximum total withdrawal during first 5 years is initial contribution plus 5% growth per annum in foreign currency.
OMIOM CHARGES
Assets Under Management(Linked Plans)
£100,000 - £199,999£200,000 - £349,999£350,000 - £499,999£500,000 - £999,999
£ 1, 000,000 +
0% INITIAL FEE
Annual Charge(Deducted Quarterly)
0.60%0.50%0.45%0.40%0.35%
CHARGES – INITIAL COMMISSION FLEXIBILITY
OPTION 1
•0-3% initial commission available.•100%-103% allocation.
WAIVED INITIAL COMMISSION•Reduce the establishment chargeor• Increase the allocation rate
•Commission/over allocation recouped equally over 5 years, up to 0.70% per annum•Outstanding establishment charges recouped on full surrender
CHARGES – INITIAL COMMISSION FLEXIBILITY
OPTION 20-3% initial “advice fee” available.Allocation 97%-100%
No establishment charges to recoup on surrender
CHARGES – OTHER COSTS
Annual Investment review fee•Up to 1.14% or equivalent monetary amountDiscretionary Manager fee•Up to 1.14% or equivalent monetary amount
Paid quarterly, minimum payment - £500 Safe custody, dealing,
•Investment review fee and Discretionary manager fee are withdrawals from a policy.•Commission and advice fee is not a withdrawal from a policy.•Commission is calculated on premium while investment review fee is calculated on fund value
OFFSHORE STOCKBROKERS (CUSTODIANS)
STOCKBROKER CHARGES-EXECUTION ONLY
INVESTMENT PORTFOLIO FEE GUIDELINE
Trade sizeCollins Stewart Credo Fairbairn Hargreave Hale Savoy Investec
Equities
GBP10,000 1,76% 1,25% 1,25% 1,52% 1,95% 1.95%
GBP20,000 1,72 1,12% 0,88% 1,13% 1,28% 1.48%
GBP30,000 1,09% 1,04% 0,61% 0,92% 1,06% 1.15%
GBP40,000 0,94% 0,96% 0,51% 0,81% 0,95% 0.99%
GBP50,000 0,86% 0,92% 0,45% 0,75% 0,89% 0.89%
GBP100,000 0,68% 0,70% 0,32% 0,62% 0,75% 0.60%
GBP200,000 0,49% 0,60% 0,26% 0,43% 0,64% 0.45%
GBP500,000 0,37% 0,54% 0,22% 0,32% 0,55% 0.35%
Custody Charge p.a 0,15%-0,25% 0,20%
0,15%-0,25% uk shares zero
GBP30/stock GBP35
GBP100/ Foreign share
STOCKBROKER CHARGES-DISCRETIONARY MANAGEMENT FEES
Portfolio SizeCollins Stewart Credo Fairbairn
Hargreave Hale Savoy Investec
GBP100,000 1,5% 1,25% Minimum 0,5% 1,5% 1,5%
GBP200,000 1,5% 1,25%GBP500,000 0,5% 1,5% 1,5%
GBP300,000 1,5% 1,25% 0,5% 1,5% 1,5%
GBP400,000 1,5% 1,25% 0,5% 1,5% 1,5%
GBP500,000 1,5% 1,25% 1,0% 0,5% 1,5% 1,5%
GBP1,000,000 1,5% 1,12% 0,9% 0,44% 1,5% 1,5%
GBP2,000,000 1,0% 0,93% 0,9% 0,34% 1,5% 1,0%
GBP5,000,000 0,6% 0,82% 0,8% 0,29% 1,5% 1,0%
Custody Charge included 0,075% included included
GBP30/stock included
STOCKBROKER CHARGES-DISCRETIONARY DEALING CHARGES
Trade sizeCollins Stewart Credo Fairbairn
Hargreave Hale Savoy Investec
GBP10,000 GBP40 0,75% included 1,52% 1,95% included
GBP20,000 GBP40 0,75% included 1,13% 1,28% included
GBP30,000 GBP40 0,67% included 0,92% 1,06% included
GBP40,000 GBP40 0,63% included 0,81% 0,95% included
GBP50,000 GBP40 0,60% included 0,75% 0,89% included
GBP100,000 GBP40 0,55% included 0,62% 0,75% included
GBP200,000 GBP40 0,53% included 0,43% 0,64% included
GBP500,000 GBP40 0,51% included 0,32% 0,55% included
INVESTMENTS
• Securities quoted on all major exchanges including:Singapore, Hong Kong, Australia,Luxembourg.
• Unit Trust funds/Mutual funds:•UK Unit Trusts and FSA recognised funds in other jurisdictions •Exchange Traded Funds (ETFs),Australian Mutual Funds
• Fixed term bank deposits• Corporate Bonds (Not Old Mutual)• Structured Products/Notes• Hedge fund of funds (mainly UCITS compliant)
INVESTMENTS
Excluded investments:• Medium Term Notes- require committee approval• Commodities• Options/derivatives• Illiquid assets• Certain jurisdictions• US,Singapore and Hong Kong unit trusts
SUPPORT
• Client Brochure• Adviser brochure• Offshore specialists
Like investments,blending spices is part
art, part science.Getting it right for
your personal palateis what counts.