Worry over bond PEPs

The trade body for unit trust and PEP providers yesterday warned of mounting concern that investors had unrealistic expectations of corporate bond PEPs. Philip Warland, director general of Autif, said he was worried that investors were buying corporate bonds from banks and building societies after seeing large - and highly unusual - returns over the last year.

"I'm worried people are buying these because they are offered by well- known institutions rather than because they understand them," he said. Mr Warland was speaking as Autif unveiled a survey of 1,000 people, a quarter of whom thought unit trusts were guaranteed to grow quicker than bank deposits.