Where is the value for discretionary managers?

This article is part of
Discretionary Fund Management - October 2013

Fixed income portfolios, and those with cautious mandates, may be under the spotlight in the latter half of 2013.

Dan Hurdley is director of research at Asset Risk Consultants.

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Conversations that Asset Risk Consultants has had this year with private client discretionary managers have covered several themes:

- Managers are working very hard in the fixed income space to find value. Index-linked products generally worked against managers and conventional bonds remained out of favour in portfolios.

- Duration was shortened further with some managers holding significant cash allocations in cautious portfolios, resulting in a “barbell” with equities providing the returns and cash moderating the risk.