The range was launched for professional investors in December 1991 after unit trust groups obtained powers to use futures and options in their funds. They provide managers with a low-cost and low-risk method of shadowing market indices. They can also be used to construct funds that rise in value when their underlying markets are falling.
Govett has a range of funds that track the UK's FT-SE 100 share index as well as leading Japanese and European indices. These are known as bull funds, and are designed for times when markets are rising. There is also a range of bear funds designed to rise when indices fall. Investors can switch between the two depending on their view of the markets.
The funds themselves do not carry greater risk than ordinary equity funds - unlike geared futures funds, they do not borrow to invest - but investors do need to take care in choosing between bull and bearfunds.
The minimum investment is now pounds 2,000, against the previous limit of pounds 100,000. Charges on the fund are lower than on most conventional equity-based unit trusts. The initial charge is 4.5 per cent and the annual charge 1 per cent.
John Govett has also launched a range of bond funds based on futures and options contracts.
A postal dealing service is available through John Govett Unit Management, Shackleton House, 4 Battle Bridge Lane, London SE1 2HR. Tel: 071-378 7979.Reuse content