Diversified Financial Products today unveiled a no-fee wrapped index return contract for plan sponsors and stable value pooled fund managers.
This contract, which Diversified claims is a first, has no wrapper fees or investment management fees, and is designed to guarantee the returns of either the Lehman Aggregate Bond index or the Lehman Intermediate Government/Corporate index and pay book-value benefits to employees.
Profit for the firm is derived from the spread between the guaranteed rate of the return on the contract and the bond index actual performance.
The Wrapper Index Return Contract has an initial two-year maturity with an annual extension.
