Questions and answers

Unit trusts let you pool your money with thousands of other investors and spread it across a larger number of investments.

Although unit trusts do not offer the same tax advantages as ISAs, they allow you to invest as much as you like. So once you've used up your ISA allowance for the tax year you can invest even more.

If you're thinking of investing money in stocks and shares through an unit trust, we recommend you only invest money you can afford to tuck away for at least 5 years, to increase your chances of a good return. But remember, most stock market investments are considered medium to high risk and there is no guarantee you'll get back the full amount you invest. If you couldn't stand the thought that your savings might go down as well as up in value, the stock market probably isn't right for you.

Our funds have no initial charges or bid offer spread, so whether you're buying or selling units the price is the same.

The Virgin Climate Change Fund has an annual management fee of 1.75%. There may also be a 20% performance related fee, which we only earn if we outperform agreed benchmarks.

Both the FTSE All-Share Tracker Fund and the Bond and Gilt Fund have an annual management fee of 1% a year, and that's it.

You can get at your cash whenever you need it. You can withdraw money over the phone or internet. We'll normally have a cheque in the post in a few days.

On the contrary. You can stop, start, or change your payments any time you like. And you can get at your money whenever you need to. All without penalty. You can also switch some or all of your investment between our different funds any time you like, free of charge.

You can call and ask us questions 08456 10 20 20 8am - 9pm Monday to Friday and 9am to 6pm on Saturday.

And if you need advice we'll put you in touch with an independent financial advice helpline.

To see the Simplifed Prospectus for the investment funds in a Virgin Unit Trust click on the link below.

Simplified Prospectus

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Stock and shares aren’t a good place to put cash you might need in a hurry. While you can withdraw your money any time, share prices go up and down on a daily basis so you could invest today and get back less tomorrow. Also longer stock market downturns (often called ‘bear markets’) can sometimes mean you have to wait a few years to see a decent return. It’s not risk-free like a deposit account and there are no guarantees about your returns.

But if you’re:

• Looking for a potentially higher return than a bank deposit account can offer.
• Prepared to accept more investment risk and tuck your money away for a few years. 

That’s when stock market investments really come into their own. Over longer timespans few other investments can match them for potential returns. That’s why they remain the No.1 place for investors looking to grow their money. And if you’re looking for an investment that can benefit the planet as well as yourself, the Virgin Climate Change Fund could be the perfect choice for you.

To compare the potential risks and returns of this fund with our other funds, click on 'Compare all 3 funds' on the left hand menu.

Don’t invest if you are:

• Likely to need your money back in a hurry – be prepared to invest for several years.
• Hoping to make a fast buck – short term stock market investors stand a much higher risk of losing money than making it.
• Afraid of risk – and couldn’t bear to see your savings fall in value.

If you think shares might not be right for you, ask us about our less volatile bond and gilt fund. Or about a risk-free Virgin Deposit Account, or a Virgin Mini Cash ISA where your money will earn interest tax-free.

We do. We’ve got around £1.9 billion of our customers’ money invested in index tracking funds and our tracker fund has increased in value by 152.8% since its launch. An index tracking fund gives a great foundation to any investor’s portfolio. They’re a low-cost, straightforward way to invest in a wide range of shares. The wider the range of shares you can invest in, the more you spread your risk. That’s why we chose the FTSE All-Share Index for our tracker fund. It’s also why we’ve based the Virgin Climate Change Fund on a broad range of shares from European and global markets, building in diversification across the widest possible range of regions and industry sectors. While higher risk than our tracker fund, it has the potential for more upside.

On its own, or as a complement to an existing tracker fund, the Virgin Climate Change Fund offers a powerful way to diversify risk and achieve above average returns, while helping the planet into the bargain.

Research shows the majority of non-index tracking funds struggle to beat the stock market with any degree of consistency. Active fees are only worth paying if you are confident the fund manager has the ability to consistently out-perform stock markets. If you can find a wide-based actively managed fund with a genuine expectation of better than average market returns, they’re a great way to diversify your investment portfolio.

GLG, our partners in the Virgin Climate Change Fund, are a fund manager with a long track record of out-performing stock markets, winning numerous major industry awards for outstanding performance.

Founded over 10 years ago, GLG are one of the largest investment fund managers in Europe, managing over twenty billion dollars worth of investments across approximately 40 funds.

They typically manage investments for wealthy individuals, families and businesses. Access to their specialist, high performing funds isn’t normally available to anyone outside the ultra high net worth bracket. But in a UK first, we’re teaming up with them to make their expertise available to every investor in the UK.

Performance fees are there to incentivise fund managers to give you better returns. Often fund managers charge a whole raft of higher fees for their expertise, whether they deliver superior returns or not. With the Virgin Climate Change Fund there’s no initial fee, no bid-offer spread, a single annual management charge to cover our business expenses, and a performance linked fee which only kicks in if we out-perform our stated benchmarks. We think this is fair. We only earn a bonus if we perform.

Wouldn’t it be nice if the taxman, the telephone company and the car mechanic had similar performance related charges too?

Sir Richard Branson is a passionate advocate of ethical and environmental ways of doing business. He gives a lead to over 200 Virgin businesses worldwide, and has drawn up a code of conduct to which Virgin companies, our partners and suppliers subscribe.

Sir Richard has personally launched many environmental initiatives, including proposals to cut aviation emissions at Virgin Atlantic and other airlines. He recently launched a new company, Virgin Fuels, which will invest $ 400 million over the next three years in renewable energy initiatives. Virgin Fuels will invest in technologies producing environmentally friendly fuels like ethanol, plus wind and wave power. He has also pledged $3 billion to help combat global warming.

At Virgin Money specifically, our brochures, mailers and marketing materials are printed on paper from sustainable and recycled sources that only use energy-efficient and eco-friendly paper mills and transport. Plus our Norwich based offices were recently renovated with more energy efficient materials, and we recycle everything from paper, cardboard, plastic cups and bottles, to mobile phones and printer cartridges.

Customers growing their savings in our index tracking fund since it launched in March 1995 have received an average return of 7.21% a year.

An investment of £3000 in March 1995 would have increased in value to £7,583.65 on 1.7.08 - a total return of 152.8%.

Source: Morningstar Workstation, 6.3.95 - 1.7.08, buying to selling unit prices, basic rate tax with income reinvested. If you had invested £3000 on the 6.3.95 it would be worth £7,583.65 after charges on the 1.7.08.

Here's how the fund has performed over each of the last five years.

Source: Morningstar Workstation, year on year, 1.7.03 - 1.7.08, buying to selling unit prices, basic rate tax with income reinvested.

Remember, with stock market investments the value of your savings and the income you get from them can go down as well as up and you may not get back the full amount you invest. It's also worth remembering that past performance of a fund isn't a guide to how well it might do in the future.

History shows that long-term investors shouldn't be too worried when the stock market falls. The people who lose out are those who panic and cash in their investment, instead of waiting for the market to rise again. For example, in 1987 the market actually finished higher than it started, despite falling 32% in the October 87 'crash'.

However, if the market goes into a longer fall (known as a 'bear market') it can sometimes be a few years before you start to see a decent return on your money. As ever, time is the key, and you should only consider investing money you can afford to tuck away for at least five years.

Not necessarily. How closely a fund tracks its chosen stock market index (known as 'tracking error') can also have an impact on your returns. Some trackers don't invest in all the shares on an index. Instead they select a 'sample' of shares to invest in, which is really active management by the back door, and will affect your returns. A 'fully replicated' tracker which buys shares in every company on the index will track the index closer.

Also, always check charges carefully. Some companies advertise what appears to be the lowest charging tracker, but there are often strings attached, or other charges that can bump up the cost.

Customers growing their savings in our bond and gilt fund since 3 October 1995 have enjoyed an average return of over 4.66% a year, turning a £5,000 investment into £8,934.12.

Source: Morningstar Workstation, 3.10.95 - 1.7.08, buying to selling unit prices, basic rate taxpayer.

Source: Morningstar Workstation, year on year 01.07.03 - 01.07.08, buying to selling unit prices, basic rate tax with income reinvested.

Remember, with bonds and gilts the value of your fund and the interest that gets reinvested can go down as well as up on a daily basis, with no guarantees you'll get back the full amount you invest. To maximise your chances of a good return you should be looking to invest for at least five years.

It's also worth remembering that the past performance of an investment isn't always a guide to how well it may do in the future.