CAPITAL PROTECTED ISAS

The turn of the millennium was all about technology, from the Y2K bug causing planes to potentially fall out of the sky, to the brave new world of the internet, where companies such as Freeserve, Marconi, Baltimore Technologies, lastminute.com, boo.com, pets.com and eToys represented the future. Em, no.

Tech stocks (and many related sectors) were on ridiculous valuations that simply made no sense and, to my mind, when AOL used its inflated stock to buy Time Warner investors really should have been seeing the Emperor’s new clothes for what they were. They weren't though. The mood was greedy and everyone was buying into the hype.

I decided to address this by building a range of 'Protected ISAs' whereby investors could still get the performance of the popular funds of the time (such as Aberdeen Technology and Invesco European Growth - which was really a tech fund), but by sacrificing a proportion of the upside (10%-30%) they would also benefit from 100% capital protection (underwritten by Barclay's Capital).

By the time the investment window had closed the dot com crash was underway. Whilst most of the companies above were wiped out and the likes of Amazon, Microsoft and Yahoo, fell by 95%, 60% and 90% respectively, my clients were locked into the pre-crash prices.