Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Annuities > Variable Annuities

About Conservative Investing In Variable Products

Your article was successfully shared with the contacts you provided.

About Conservative Investing In Variable Products

People do need to invest to reflect their own risk profile, says John Fenton, a principal with Tillinghast in the Atlanta office. But those who want to invest conservatively in a variable product should be careful, he says.

For instance, if they seek out bond subaccounts, they might do the same thing that investors in the 1990s did, Fenton says. That is, they may be “chasing the hot performers at the wrong time.” Bonds still carry some risk, he adds, and the returns may not be as high as desired.

Money markets arent ideal either, he indicates. They had a net return last year of only 0.5%, Fenton says.

“Conservative investments in variable products just dont work as well over the long term,” he maintains. “The producer needs to know this and remind the customer of this. The real issue for consumers today is, no one knows what will happen.”

–Linda Koco

Reproduced from National Underwriter Edition, July 7, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.