Asset Allocator recently ducked in out of the cold to catch up with David Hood who runs the centralised investment proposition at RBC Brewin Dolphin.
The manager of managers fund range they operate recently went past £6.5bn in AUM and they celebrated, as all the cool kids do, by bringing out two new share classes with one of those aimed specifically at model portfolio providers who may wish to include the funds.
Around £830mn of that is held within the MI Select Managers Alternatives fund, so we thought it prudent to ask Hood what the term alternatives means to Brewin Dolphin, and how they get that exposure within an open-ended fund structure.
The Brewin man said the fund is “a combination of gold, property and absolute return strategies”, with the gold exposure achieved through ETC funds, which are backed by physical gold and would, according to Hood, be difficult to hold within a conventional model portfolio structure.
The property assets are mostly through investment trusts, with the folks at RBC Brewin Dolphin recently adding infrastructure investment trusts to the funds, with valuation considerations the key there.
Another of the holdings he has in the alternatives bucket is a fund that invests in “catastrophe bonds”, that is bonds issued by insurance companies to limit their risk against natural disasters.
The catastrophe bond funds in Brewin’s portfolio can only be sold weekly, which Hood says also makes it tough to own those in a traditional model portfolio.
