What is typically true of the market value of a segregated fund after a reset?

The statement regarding the market value of a segregated fund after a reset is accurate in that the reset value becomes significant for future guarantee calculations.

When a reset occurs, the market value of the segregated fund is adjusted to reflect its highest previous value, often referred to as the "reset value." This new value forms the basis for determining future guarantees associated with the segregated fund. Hence, if the market value rises after the reset, future guarantees will be calculated based on this higher level, providing enhanced security and potential for growth in the investment.

The reset feature is particularly important because it allows policyholders to take advantage of market increases that may occur over time while still maintaining a floor value that ensures protection of capital. This design element is one of the unique characteristics of segregated funds, allowing investors to benefit from favorable market conditions while having a guarantee in place.

In summary, the reset value's role in establishing base guarantees directly influences how policyholders can plan for their investments and understand the protective nature provided by segregated funds.