DFM launches 'ultra-low cost' model portfolios

DFM launches 'ultra-low cost' model portfolios

Discretionary fund manager Seven Investment Management has launched five multi-asset passive model portfolios.

According to 7IM the products, named the 7IM Pathway range, are “ultra-low cost” and aim to offer advisers a “simple way to create a well-diversified portfolio” for a 0.15 per cent annual fee, plus fees for the underlying investments.

Initially the new products will be available on six platforms — 7IM, Novia, Transact, Standard Life, Aviva and Ageon — but 7IM stated other platforms would shortly follow.

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The new range has five pathways of varying risk which will be managed by 7IM’s investment team.

Asset AllocationPathway 1Pathway 2Pathway 3Pathway 4Pathway 5
UK Equity10%17%20%26%28%
US Equity8%14%20%25%26%
Japan Equity3%4%8%10%12%
European Equity4%5%9%10%12%
Emerging Markets Equity3%4%7%10%15%
Global Government Bonds11%8%5%2%
Gilts And Government-Related Securities7%5%3%
Global Corporate Bonds33%23%8%2%
Global High Yield6%7%5%4%
Global Inflation Linked Bonds4%3%3%
Emerging Market Debt6%4%5%4%
Real Estate3%5%5%5%
Cash & Money Markets5%3%2%2%2%

The portfolios will be rebalanced quarterly but 7IM stated the firm could change the asset allocation at any time to ensure the portfolios remained aligned with the overall asset allocation goal.

Verona Kenny, managing director of intermediary at 7IM, said: “7IM is a pioneer when it comes to providing passive investment solutions to the retail market, using passive and smart passives in funds, models portfolios and discretionary services since 2008.

“The launch of the 7IM Pathway range sees us building on this reputation whilst responding to the changing market we work in to deliver a very competitively priced multi-asset passive solution.”

Ms Kenny said the new range meant clients would have access to the firm’s investment expertise and risk management in a “cost-effective” format.

Martyn Surguy, chief investment officer of 7IM, thought it was the “perfect time” to launch such products as he thought the market headed into an environment of lower expected returns.

He added: “Importantly, the 7IM Pathway model portfolios are underpinned by our robust strategic asset allocation process which has a demonstrable track record in controlling the downside while delivering strong returns with real diversification benefits.

“In other words, we believe this new range provides you and your clients with a steady hand to navigate what could be turbulent times ahead.”


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