Bonds, such as the U.K. premium bond, can give the child a chance to be exposed monthly to the world of finance at an age when they would not understand other aspects of it.
It will be either a government based on dilution and compromise or a weak day-to-day, deal-and-favor arrangement that will see the value of the pound fall on the foreign exchanges and the premium of U.K. gilts over German bunds widen.
The longer the policy is in force, the greater the proportion of the premium that goes into a cash value account that works like an IRA or 401(k) plan.