Quick Question
- Thread starter jmarkk1
- Start date
Since the S&P is up 20%, any capped ANN p2p product has underperformed.
That being said, you're not actually trying to beat the market in an FIA, you're trying to reduce volatility and add safety. Positioning a FIA to keep pace or beat the market is a bad idea (not saying that you're doing that).
This would be a good question to ask when the market is down 20% as well...those who got capped out over the last year will have kept those gains.
- Thread starter
- #3
I understand protection side of FIA...just trying to grasp what average gains are with FIA when market is up like it has been this year. I heard somewhere that you can expect to capture about 30% of market gains...and obviously none of the losses.
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What about comparing S&P growth to monthly pt to pt?
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What about comparing S&P growth to monthly pt to pt?
- 16,901
I was just looking at a new one that Allianz has that has around a 3% spread and then 100% participation with no cap. It's not based on the S&P but a composite index (I forget the name of the composite.)
The back tested illustration looks very good over the past 20-years and even better over the past 10. Sorry if that sounds vague. I don't remember the exact figures but there were a lot of years with double digits of interest 10-14% and very few with zeros.
Everyone that I've ever sold the Annexus to has always been real happy with the performance. That's another uncapped one with a spread but the participation rate on that one got pretty low for a while. They are all raising back up now.
The back tested illustration looks very good over the past 20-years and even better over the past 10. Sorry if that sounds vague. I don't remember the exact figures but there were a lot of years with double digits of interest 10-14% and very few with zeros.
Everyone that I've ever sold the Annexus to has always been real happy with the performance. That's another uncapped one with a spread but the participation rate on that one got pretty low for a while. They are all raising back up now.
It really depends on the product and the crediting strategy that you've selected. Aviva has an uncapped strategy that was up 15% last time I checked. If you have a smooth annual return (rare), a monthly cap may look great.
There are too many options to make a blanket estimate like 30% of gains. After all, if you have a 6% cap and the market was up 6%, you caught 100% of the gain. If you have a 4% trigger and the market was up 1%, you returned 300%.
I position their return potential between traditional fixed and variable.
Sorry I don't have more concrete data handy. Maybe someone else has some industry stats for you.
