Has anybody on the site purchased traded endowment policies (TEPS) ?
Can you recommend a dealer ?, do you know of auctioneers who specialise in this market ?
Comments relating to investing in TEPS appreciated
odaat
Full Version: Trading Endowment Policies (teps)
QUOTE(odaat @ Dec 28 2004, 11:15 AM)
Has anybody on the site purchased traded endowment policies (TEPS) ?
Can you recommend a dealer ?, do you know of auctioneers who specialise in this market ?
Comments relating to investing in TEPS appreciated
odaat
Can you recommend a dealer ?, do you know of auctioneers who specialise in this market ?
Comments relating to investing in TEPS appreciated
odaat
Odaat,
I have looked at TEPs as a potential low risk investment.
I wondered whether the future minimum guaranteed value (Sum Assured plus Bonuses todate) could offer a reasonable annual return (say 4 - 5 % pa) based on the purchase price together with the future premiums payable. Any terminal bonus paid (If at all) should the stock market recover would increase the annual return.
I found that most of the policies offered negative returns based on the minimum guaranteed future value (MGFV) or were only slightly positive and one was therefore relying on the terminal bonus to provide the return. In addition, I felt that the prices did not take into account the possibility of terminal bonuses being lower in the future - which is I felt was highly likely.
I did this research around 9 months and keep intending to re visit to see whether TEP values have changed.
You can try this website Foster & Cranfield TEP Auctions
I developed an Excel workbook which enabled me to calculate the guaranteed annual returns based on the auction guide price and the surrender value.
(As an alternative, you could buy one of the ITs that invest in TEPs - these usually trade on a discount and the risk is spread over many TEPs)
I'd welcome some discussion on TEPs as an alternative low risk investment.
M21er,
I have been looking into the TEP market for a while as I was looking for a low risk investment vehicle for school / uni fees for my children.
I looked at the results from the Foster + Cranfield site, very few sales per auction.
I agree with you that the final bonus payouts can not be relied upon.
A few companies have stopped trading in TEPS i.e. Dobie + co, Endowments first to name a few.
I am trying to seek a TEP trader type of course, so I have some idea of which product is hot and which to drop.
to be honest, the more I look at the market - the more warning signals go up.
This area is definately for the pro's.
Odaat.
I have been looking into the TEP market for a while as I was looking for a low risk investment vehicle for school / uni fees for my children.
I looked at the results from the Foster + Cranfield site, very few sales per auction.
I agree with you that the final bonus payouts can not be relied upon.
A few companies have stopped trading in TEPS i.e. Dobie + co, Endowments first to name a few.
I am trying to seek a TEP trader type of course, so I have some idea of which product is hot and which to drop.
to be honest, the more I look at the market - the more warning signals go up.
This area is definately for the pro's.
Odaat.
QUOTE(M21er @ Jan 3 2005, 10:10 PM)
Odaat,
I have looked at TEPs as a potential low risk investment.
I wondered whether the future minimum guaranteed value (Sum Assured plus Bonuses todate) could offer a reasonable annual return (say 4 - 5 % pa) based on the purchase price together with the future premiums payable. Any terminal bonus paid (If at all) should the stock market recover would increase the annual return.
I found that most of the policies offered negative returns based on the minimum guaranteed future value (MGFV) or were only slightly positive and one was therefore relying on the terminal bonus to provide the return. In addition, I felt that the prices did not take into account the possibility of terminal bonuses being lower in the future - which is I felt was highly likely.
I did this research around 9 months and keep intending to re visit to see whether TEP values have changed.
You can try this website Foster & Cranfield TEP Auctions
I developed an Excel workbook which enabled me to calculate the guaranteed annual returns based on the auction guide price and the surrender value.
(As an alternative, you could buy one of the ITs that invest in TEPs - these usually trade on a discount and the risk is spread over many TEPs)
I'd welcome some discussion on TEPs as an alternative low risk investment.
I have looked at TEPs as a potential low risk investment.
I wondered whether the future minimum guaranteed value (Sum Assured plus Bonuses todate) could offer a reasonable annual return (say 4 - 5 % pa) based on the purchase price together with the future premiums payable. Any terminal bonus paid (If at all) should the stock market recover would increase the annual return.
I found that most of the policies offered negative returns based on the minimum guaranteed future value (MGFV) or were only slightly positive and one was therefore relying on the terminal bonus to provide the return. In addition, I felt that the prices did not take into account the possibility of terminal bonuses being lower in the future - which is I felt was highly likely.
I did this research around 9 months and keep intending to re visit to see whether TEP values have changed.
You can try this website Foster & Cranfield TEP Auctions
I developed an Excel workbook which enabled me to calculate the guaranteed annual returns based on the auction guide price and the surrender value.
(As an alternative, you could buy one of the ITs that invest in TEPs - these usually trade on a discount and the risk is spread over many TEPs)
I'd welcome some discussion on TEPs as an alternative low risk investment.
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