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Savers move to stocks & shares: are your investments protected?

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Written by: Paloma Kubiak
18/01/2017
As returns on cash have reached record lows, more people are expected to consider a move to investments. But many aren’t aware of the protections in place in case the worst happens.

Two-thirds of people know that deposits with a bank or building society are protected, but when it comes to investments, only a third know that they fall under the remit of the Financial Services Compensation Scheme (FSCS).

The research from campaign group Which? also found that just 4% of people know the maximum level of compensation of £50,000 applies per investment firm.

It said that while the compensation rules for investments were more complicated than they are for bank deposits, the regulator, the Financial Conduct Authority (FCA) and the FSCS aren’t doing enough to help improve understanding of the protections available.

Harry Rose, editor of Which? Money, said: “With record low returns on cash savings, more people will be turning to other types of investments and should know there is a safety net in place should the worst happen. Investment firms, the regulator and the FSCS itself should be doing more to help investors understand how their money is protected.”

What is and isn’t protected?

See YourMoney.com’s full guide: Are my investments protected and will I get compensation if anything goes wrong? for more information.

But below is a summary of the protections available to investors:

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