Hermes has revealed a new fund to add to its already growing retail portfolio.
The Hermes Multi Asset Inflation fund hopes to provide investors with a different approach to multi-asset investing by building inflation into both asset allocation and security selection in order to target real growth outcomes for investors. The group says its strategy aims to protect investments from inflation by identifying what drives it as well as understanding the “dynamic link” between inflation and various asset classes.
The multi-asset fund will allocate across a range of inflation-related assets, targeting outperformance of UK RPI plus 3 per cent, while delivering a low tracking error to inflation. The fund will be providing volatility in line with inflation-linked gilts.
The investment team’s approach avoids any behavioural biases but the group says it allows for qualitative judgement. It is the first fund in the newly put together Hermes Multi Asset team, led by Tommaso Mancuso, and will be available to both wholesale and institutional investors in Ucits format.
The minimum subscription amount for the retail share class is €1,000 (£800) with no minimum subsequent investment. The fund is also subject to an annual investment management fee of up to 1.2 per cent.
Comment:
Multi-asset funds have been increasingly popular with investors for their simplicity and ability to invest in multiple assets at a lower cost than investing in numerous funds.
The fund’s target is not huge, especially as RPI currently stands at just 2.3 per cent.
The fund appears to have a lot of research abilities behind it, with many different ways of assessing which assets and companies are right to beat inflation, and has a newly formed multi-asset team specifically for starting a multi-asset product range.
Hermes, which is most known for managing BT’s pension scheme, has been growing massively in the UK in recent years, from £2bn of third party assets to £6bn in just three years and has launched a number of funds throughout this year, including most recently a tie-up with Chinese asset managers CSOP.
