So what are the options?
Taking more risk in the portfolio to effectively “chase the income rate” through equity exposure may work but at a cost of substantially increasing risk.
Many investment advisers are looking wider than traditional assets for income with a Multi-Asset approach but caution still needs to prevail as expertise is required to balance more diversified portfolios for risk and return in this investment approach.
Delivering on the investor objective
Having a range of clear and specific objectives aligned to both risk and investors potential needs is also a consideration.
Multi-Asset diversification provides multiple levers for asset managers to optimise portfolio construction and increase the predictability of the portfolio and in doing so raise the probability of delivering the selected outcome.
When it comes down to it, it’s all about asking the right questions.
When assessing a Multi-Asset provider the key things to consider are:
- Does the Asset Manager have the relevant experience and expertise particularly in Alternative assets?
- Is the investment outcome clear and has it been historically delivered?
- Is the portfolio transparent, is it clear what is being invested in and why?
- Is the Investment process understandable and explainable?
There are many multi-asset approaches out there but research and due diligence is key to selection.
The Momentum Diversified Growth and the Momentum Diversified Income funds have both recently been named in the FT Adviser top 100 funds.
Momentum Diversified Income Fund –
Momentum Diversified Growth Fund –
Sources: Morningstar, MGIM. Fund performance is calculated on a total return basis, net of all fees and in GBP terms. The value of the underlying funds and the income generated from them can go down as well as up, and is not guaranteed. Investors may not get back the original amount invested. The value of investments involving exposure to foreign currencies can be affected by currency exchange rate fluctuations. Past performance is not a guide to future performance. The CPI +6% target was introduced in 2020.
For professional investors only.
This communication represents the views of Momentum Global Investment Management at the time of preparation. Views may be subject to change and should not be interpreted as investment advice. Whilst Momentum Global Investment Management Limited has used all reasonable efforts to ensure the accuracy of the information contained in this communication, we cannot guarantee the reliability, completeness or accuracy of the content. This document is provided for the purpose of information only. Momentum Diversified Funds are sub-funds of the VT Momentum Investment Funds II ICVC umbrella, an open-ended investment company which is authorised by the Financial Conduct Authority (FCA). Valu-Trac Investment Management Limited (authorised and regulated by the FCA) acts as the Authorised Corporate Director (ACD) of the VT Momentum Investment Funds II ICVC. Investment in the Funds may not be suitable for all investors. This document is for information only and does not provide you with all of the facts that you need to make an informed investment decision. Investors should read the Key Investor Information Document (KIID) and seek professional investment advice prior to investment. The prospectus and KIID documents are available (in English) on the website via www.valu-trac.com This financial promotion is issued by Momentum, the trading name of Momentum Global Investment Management Limited authorised and regulated by the FCA, Company Registration No. 3733094. Momentum has its registered office at The Rex Building, 62 Queen Street, London EC4R 1EB. Momentum Global Investment Management Limited is authorised and regulated by the Financial Conduct Authority in the United Kingdom, and is an authorised Financial Services Provider pursuant to the Financial Advisory and Intermediary Services Act 37 of 2002 in South Africa. © MGIM 2021.