Can a Bond ISA Be Used For Stocks & Shares Component

Joey122

Hi All,

Can anyone confirm whether a bond fund can be used for stocks and shares ISA componet .

By this I mean :

3K in Cash ISA
4K In Bond ISA

If the bond isa invested in goverment floating rate bonds then the return should be guaranteed to be in line with base rates and risk free.

Do these types of funds exist?

For years I have always investd in the cash component but never in the share component becuase I did nt want exposure to FTSE or Nasdaq shares.

What I wanted was a low risk 6% tax free yield.

Can this be achieved ? Can anyone suggest low risk ISA funds which can be used for the Stocks and shares component?

Thanks very much

Joey122

Any help greatly appreciated -

Is this question clear - If not please do ask

Aegis

I think the question might be confusing to some people (myself included), as I've never heard of a product specifically named a "bond ISA". I'm fairly convinced that within a stocks and shares ISA you can invest in gilts and corporate bonds, if that's what you mean.

However, I have no experience with doing so and therefore can't recommend a good provider for such an account.

cheerfulcat

Joey122 wrote: »

Can anyone confirm whether a bond fund can be used for stocks and shares ISA componet .

Yes, a bond fund can be held in a stocks and shares ISA.

If the bond isa invested in goverment floating rate bonds then the return should be guaranteed to be in line with base rates and risk free.

Do these types of funds exist?

There are funds which hold gilts; you'd have to examine them to see whether any of them hold predominantly floating rate bonds. Have a look on Trustnet.

I'm not sure whether your conclusion is correct, though. Charges will eat into returns; also I doubt whether the fund managers hold these bonds to maturity ( the only way they would be 100% risk free ).

For years I have always investd in the cash component but never in the share component becuase I did nt want exposure to FTSE or Nasdaq shares.

There's a whole world to invest in! You aren't restricted to FTSE and Nasdaq!

egamar

Start at FundsNetwork or CoFunds to see and research the range of funds they offer (incl. corporate/government bonds and a whole panoply of investments) and then, if interested complete the transaction(s) through a discount broker (listed elsewhere on this site, I'm sure).

Albeit at some risk, and over a period when any fool could have made money (this fool did) investing in a wide range of funds has provided an average annual return of 27% since 02/03 for a total profit so far of 82%. Both of the recent tumbles in the FTSE/DOW have been offset by investments in property, emerging markets, and gold/natural resources. Since May, despite the Northern Rock & liquidity crisis, property downturn and suchlike I'm up 6% overall.

Joey122

All,

Thanks this is very helpful ! WOw - I didnt know about FundsNetwork

Quick question :

How do you interpret the folliwng :
03 04 05 06 07
Fund 4.5 2.6 4.8 -6.4 0.6
+/-Idx 1.2 -0.3 0.7 0.5 -2.0
+/-Cat 0.5 -0.6 -0.6 -2.9 -0.6

ie:
http://www.fidelity.co.uk/direct/research/fundsupermarket/fund_finder/fund-finder.html?Nr=NOT%2528607%2529&oldView=widget&N=0&Ntt=&N=&N=652&N=&newView=results&Ns=

Is this simply that in 2006 this fund made a loss of 6.4 %