Ready-made Investments

Direct Investing is the new name for Smart Investor. We’re making this change because we want to provide more clarity that this service is for customers who want to make their own investment decisions.

You can choose from thousands of investments including funds, shares, gilts and bonds, and take advantage of our expert insights, research tools and resources to inform your decisions.

Ready-made Investments are a range of Nova Bank funds designed to offer investors a quick and simple way to create a diversified portfolio.

The five funds all invest in a mix of cash, bonds and shares. The balance of these asset types varies between the funds. Funds offering lower risk and likely lower returns, have a larger portion of their investors' money in cash and bonds. The funds which are likely to be more volatile are more heavily invested in shares which have the potential for higher returns.

Ready-made Investments are managed funds looked after by Nova Bank’ experts. You simply choose a fund that matches your comfort with risk, and the fund managers take care of the mix of UK and international shares, bonds and cash.

No, Ready-made Investments can be suitable for anyone lacking the time or expertise to pick individual stocks or those who are looking for instant diversification.

Within these diversified funds investments are spread across a range of assets, countries and companies which helps smooth returns and hopefully provides a better opportunity for growth.

Some may view Ready-made Investments as a great first investment as you can buy a completely diversified portfolio managed by an expert, in just a few steps.

Your Ready-made Investments can be bought and sold just like other funds. Simply log in to your account and click ‘sell’ next to the fund you no longer wish to hold. Funds deal daily and your holding will be sold at the next available dealing point.

The proceeds from your sale will be available to reinvest on your Direct Investing account as soon as the details of your sale are confirmed, or after four working days the money will be available for you to withdraw to your current account.

There are two types of fund units. Income units distribute any interest or dividend income from the fund directly to you. An accumulation unit is designed to offer you growth in the fund, so any income will be kept in the fund and reinvested, raising the value of your investment.

The funds lower down the risk scale (Defensive, Cautious and Balanced) offer both income and accumulation units. If you purchase income units and would like income to be paid directly to your bank account, you can arrange this through your Direct Investing account by logging in to your account and changing your preferences within your investment settings.

The higher risk portfolios (Growth and Adventurous) are focused on generating capital growth and are only available as accumulation units.

All the Ready-made investments put your money in a mixture of shares, bonds, and cash, which gives you instant diversification to help protect against stock market falls, but the proportion they hold in each differs between the funds.

To decide which of the five options is most suitable for you, you will need to consider your attitude to risk. Are you more comfortable taking a lower risk approach? Or are you happy to take a bit more risk in the hope of potentially higher returns?

The timescale for your financial goals is also important. Most investors are happy to take on more risk when they are investing for longer time frames, usually five years or longer.

There is no need to choose just one of the Ready-made investments. You can divide your portfolio between as many as you wish and add other funds, shares, and bonds to create a portfolio that’s just right for you and your goals.

Yes, you can buy as many as you wish.

You may have different goals for each of your accounts and therefore different attitudes to risk for each. For example, you may be willing to accept more risk with your self-invested personal pension (SIPP) if retirement is many decades away than within your ISA which could be used for shorter term goals such as a house purchase in five years’ time.

These different goals may mean different Ready-made Investments are more suited to different accounts.

Alternatively, you may find more than one of the Ready-made Investments is a good fit for your plans and so a combination would provide the best portfolio for you.

You can start with as little as £50.

These funds are designed to be accessible for new investors who want a simple, straightforward approach.

Each fund has a risk rating to help you decide which fund (or funds) are right for you.

Generally, the more risk you take, the higher the potential reward but also the higher potential for losses.

You should also consider the time frame of your goals. Investing should only be for at least five years but some goals may have much longer time horizons. Planning for a life after work or to put a child through university could be ten or twenty years away. When you’re building wealth for goals more than a decade in the future you can often afford to take on more risk.

Once you’ve identified your risk level you can pick the fund matches your attitude to risk.

Yes.

You can invest in UK and overseas shares, bonds, funds, Exchange Traded Funds (ETFs), investment trusts and Ready-made Investments in your Direct Investing accounts.

You have the freedom and flexibility to choose the combination of investment that’s right for you. Ready-made Investments can form the core of your portfolio while you add your own shares, funds or ETFs alongside if you wish. Alternatively, you can build and manage your own diversified portfolio without using Ready-made Investment funds.

The value of any investment, including Ready-made funds, can fall as well as rise and you may get back less than you invested.

When you hold funds for the longer term it is likely that there will be rises and falls in the markets while you are invested and that you’ll see your holding decrease in value as well as increase. It’s important to think about this as you start your investing.

One way to protect your account from market volatility is to make sure that your portfolio of investments is diversified. This means you hold a wide range of investments spread across different types of assets, industries, and locations around the world. Diversifying can offer a level of protection as different assets respond differently to the same market events. A well-diversified portfolio can absorb market shocks better than one concentrated in a few high-risk areas. These five funds are diversified to help spread your risk and position yourself for long-term success. Risk can’t be removed entirely but diversification can protect your portfolio during market downturns.

Once you’re invested, you can log in through online banking or the App at any time to view your fund’s performance, see updates, and access research or insights.

We will send quarterly updates on your Ready-made Investments. Remember that these investments are for the longer term – at least five years – this means you don’t need to worry about the day-to-day movements or short-term noise. There’s no need to dedicate a lot of time to keeping an eye on your funds, an annual review or when your circumstances change is usually enough.