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Four Quilter funds require action

Four Quilter funds require action

Quilter Investors has flagged four out of its 68 funds as requiring action in its annual value assessment report.

The report, released on Friday (July 30), outlined the Quilter Diversified Portfolio Fund, Quilter Strategic Bond Fund, Global Property Securities Fund, and Quilter Unconstrained Equity Fund all required action based on their overall performance. 

The firm said action had “already been taken” on all the funds, and they will continue to be monitored closely.

The Quilter Property Securities Fund showed relatively weak performance in 2019, which the firm attributed to holdings that were underweight to industrial REITs, “which did well during the period”, as well as being overweight to German residential holdings, “which did poorly during that period”. 

The investment adviser made changes to the portfolio holdings to address this, and according to Quilter, in the past 12 months, “performance has improved”.

The report was released in two parts, one for the firm’s multi-asset portfolio solutions and the other covering the firm’s sub-advised funds.

Tim Breedon, chairman of Quilter Investors, said the majority of the firm’s funds had delivered “against their investment objectives over the long-term (five years)”.

He added: “While shorter-term performance has, in some instances, been mixed, I’ve been impressed by the speed at which this has been identified and the range of options generated to address any issues that have risen as a result.”

Head of investment directors at Quilter Investors, Danny Knight, told FTAdviser he thinks the firm is in a good place.

“From a performance perspective, I would say we're in a pretty good place," he said.

“I think it would be naive for any business to say that performance is unilaterally glowing, and maybe that's some of the challenge with the value assessments, that people haven't been critical enough of themselves.”

He added measuring value when it comes to investing was difficult, as people invest for a wide range of reasons.

“People might be critical of one fund or two funds, but actually, quite often that [fund has] been used as part of a wider portfolio.” 

The real measure, he said, was: “Is that fund doing a job in the portfolio that an advisor or discretionary investment bank expected?”

Lagging performance

Quilter said a further 18 funds were delivering on their primary investment objectives but showed a long-term performance lower than the anticipated level. 

The performance of all the funds in the firm’s Creation portfolio, including the Creation Adventurous, Balanced, Conservative, Dynamic, and Moderate Portfolio funds, have been highlighted as below the anticipated level. 

Since its last value assessment report, Quilter Investors has closed four funds (Quilter Investors Bond 3 Fund, Quilter Investors Europe (ex UK) Small/Mid Cap and Quilter Investors Emerging Markets Bond Fund and Quilter Investors High Yield Bond Fund), as well as appointing a new chief investment officer.

Bambos Hambi joined the firm in November last year from Aberdeen Standard Investments, where he was head of multi-manager strategies.