Norwich Union increases Balance Distribution (life) Fund's exposure to property

Article date: 2 August 2004

Norwich Union has changed the asset mix of its BalancedDistribution Fund. It has increased the fund’s exposure toproperty and reduced the proportion invested in bonds.

The change is designed to increase the income generated by thefund without increasing levels of risk.

The new asset mix of the Norwich Union Balanced DistributionFund is:

 UK equity incomeUK corporate bondsProperty
New asset mix40%32%28%
Previous asset mix40%40%20%

Neil Davies, head of investment product development, said: "Weare increasing the proportion of the fund invested in propertyfollowing an asset allocation review. We believe the prospects forthe sector remain bright. Our view is that a well diversifieddistribution fund should currently have about a third of its assetsin commercial property.

"The Norwich Union Balanced Distribution Fund holds a higherproportion of property than many other distribution funds in themarket – a typical distribution fund holds about 6% property- and our view is that this may enable it to produce better returnswithout increasing risk.

"The Norwich Union Balanced Distribution Fund will appeal toinvestors who want a rising level of income and who can see thebenefits of investing in a range of assets to reduce risk.Investing in a mix of equities, bonds and property makes sensebecause they react differently to different economicconditions."

He added: "As we have seen, investing only in shares can be areal roller-coaster ride but investing in a more diversified rangeof assets is more likely to provide steadier returns than anotherfund that concentrates on a particular investment."

The value of a fund and the income from it may go down as wellas up, and the investor may not get back the original amountinvested.


Press office contacts:
David Gwyer 01904 452828 Out of hours 07800 699508
James Evans 01904 452791 Out of hours 07790 487105
Rob Pell 01904 452659 Out of hours 07968 934091
Louise Soulsby 01904 452617 Out of hours 07810 057262

About the Norwich Union Balanced Distribution (life)fund
The Balanced Distribution Fund was launched in July2003 and is available through Portfolio, which is NorwichUnion’s investment bond. The aim of the fund is to provide agood level of rising income with the potential for capital growth.To achieve this, it invests in a mix of UK equities, UK corporatebonds and property. It will appeal to investors who want adiversified portfolio to spread risk, generate income and offer thepotential of capital growth.

The Balanced Distribution Fund offers:

  • Potential for capital growth in addition to a regularincome
  • Choice of income options – distribution option, regularwithdrawals and adding the income to your bond for growth
  • Flexible income payment – monthly, quarterly,four-monthly, half-yearly or yearly.

The views and opinions expressed are those of Norwich Union,they are not a forecast of future returns or a recommendation tobuy and sell investments.

Performance figures (7 July 2003 - 7 July2004)

Funds% GrowthRankQuartile
Norwich Union Balanced Distribution (life)7.39152
ABI UK Life fund - Distribution Life4.33353

Past performance is not a guide to future returns.

About Norwich Union
Norwich Union is the UK's largest insurer. It is the UK's largestprovider of life, pensions and investment products and one of theleading IFA providers. IFAs provide around 75% of the company'slong-term savings business in the UK. Norwich Union has strategicalliances with building societies and other leading UK brand namesincluding Tesco Personal Finance and The Royal Bank of ScotlandGroup. Norwich Union’s news releases and a selection ofimages are available from Aviva's internet press centre at

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