Pricing of Unit-linked Funds

We're making changes to the way some investment transactions are priced. 'Investment transactions' are any instruction you give to us to buy, sell or switch funds with your money. To make sure you know what we're changing, we've also given some basic information on unit-linked funds.

Please note the information below doesn't apply to 'with profits' investments.

What is a unit-linked fund?

Most funds available through our products are 'unit-linked'. This means that they are divided into a number of units of the same value. Investing in a unit-linked fund involves buying units and taking money out involves selling units.

How are unit-linked funds priced?

The daily price of each unit depends on the value of the fund. Broadly speaking, the value of each unit is set by taking the total value of the fund and dividing by the number of units in the fund.

What's the new way of pricing?

When you tell us to buy or sell your funds, we'll usually do so using the unit price that we publish on the next working day. (Previously, we would have often used the price published on the working day that we received your instructions.)

Why are these changes being made?

Although the price is published on the next working day, it is based on the value of the fund today. So if you tell us to buy or sell today, you'll get the price calculated today. This change brings us in line with the industry and makes it clear what price you'll get when buying or selling funds.

Which products are affected?

We've changed the pricing of funds on single and transfer payments into some of our products. More changes will follow during 2010.

To find out if your product has been affected, or for any further questions, please call the number on your statement, or contact our call centre.