With-profits funds are maintaining their popularity with conservative/ middle of the road investors, says a new report. The Moneywise Guide to With Profits Investments: a safe rewarding home for your nest egg, explains the background and current environment for this type of investment.

The fall-off in yields for other secure investments means with-profits are a front runner in the safer segment of balanced investment portfolios, the report says.

With-profits spread investment over shares and government stocks and sometimes property. They distribute bonuses out of stored-up investment surpluses. These reserves smooth out market peaks and troughs.

This composition is their key attraction as with-profits funds more than double the yield on deposits and other low-yielding options without a corresponding hike in underlying risk, the report says.