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IA Volatility Managed sector to launch in April after delay

IA Volatility Managed sector to launch in April after delay

The Investment Association (IA) is to launch its Volatility Managed sector in April, five months later than originally intended, Investment Adviser understands.

The trade body first announced the creation of the group last summer, following a 16-month consultation aimed at finding a home for the growing cohort of outcome-focused funds sitting in the Unclassified sector.

The IA initially said the sector would go live in November 2016. While this deadline has since lapsed, the process is now understood to be in its final stages, with plans to launch the category on April 3.

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The new category will look to house funds that “target a client’s attitude to risk set out in terms of volatility”, and could feasibly include as many as 120 portfolios that currently sit in the Unclassified grouping, the IA said last year.

Sector membership requires funds to pass a “high hurdle of transparency”, including an obligation to tell advisers how volatility is measured.

The launch is viewed as a first step to better categorising outcome-focused funds. The trade body previously suggested further work could be possible once the grouping has been established.

The current schedule would mean the sector is launched on the same day that the IA’s new UK Equity Income rules go live. The trade body has eased yield requirements for the grouping following a separate 12-month consultation.

The IA declined to comment.