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Guide to Mixed Investments and Balanced Managed

    CPD
    Approx.50min

    Introduction

    The financial crisis led to some funds generating some extreme results, yet they resided in sectors with a title that might suggest this was not possible. For instance there are funds that lost more than 30 per cent in the calendar year of 2008, yet these vehicles resided in the peer group formerly known as the Cautious Managed sector.

    This is why the IMA revised the sectors in 2012 to clarify the risks that investors may be exposing themselves to. The sector’s names were changed to incorporate the amount of equity exposure allowable.

    This guide focuses on the sector formerly known as Balanced Managed. While the sector is now known as Mixed Investment 40 to 85 per cent Shares sector many of the funds that sit within this group are still called Balanced Managed.

    This guide explores what advisers and their clients can expect from funds that retain the Balanced Managed title, how to ensure you get the best fund for your client and monitor the vehicle to make sure it delivers what investor’s expect.

    Contributing materialwas provided by Adrian Lowcock, senior investment manager for Bristol-based Hargreaves Lansdown; Marcus Brookes, head of multi-manager at Schroders; Alistair Campbell, head of investment marketing at Skandia; Richard Peirson, manager of the Axa Framlington Managed Balanced fund; and James Dalby, market intelligence manager of Aviva UK Life.

    This guide is sponsored by Axa Investment Managers. All editorial is independent.

    In this guide

    CPD
    Approx.50min

    Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

    1. What percentage of investments in this sector must be denominated in developed market currencies?

    2. What was the minimum equity exposure of the top three funds in the sector over 10 years?

    3. What is a credible alternative to a Balanced Managed fund, according to Mr Campbell?

    4. What fund is selected by Mr Lowcock as a default option in corporate pensions?

    5. Historically, how much of the Axa Framlington Managed Balanced fund been invested in equities?

    6. Roughly what percentage of funds in the sector have a Distribution Technology risk rating of between 5 and 6?

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