Talking Point  

The role of multi-asset funds in a volatile environment

  • List the diversification benefits of multi-asset funds
  • Describe what investing in a multi-asset portfolio entails
  • Explain the risks of multi-asset funds
CPD
Approx.30min
The role of multi-asset funds in a volatile environment
How advisers can use multi-asset funds to achieve returns for their clients
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Multi-asset funds have in recent years proven to be a useful way for investors to earn returns, while still diversifying their portfolios. 

This is largely due to the fact that multi-asset funds give clients access to several asset classes at once, without having to invest vast amounts of money. 

It may be an interesting time for advisers to be using multi-asset funds, not least because the global economy appears to be troubled. 

The US and China have made little progress to resolve their trade differences, the UK could be headed for a hard Brexit in just over two months and the US bond market appears to be predicting a recession, seen through the US inverted yield curve. 

But as with everything in life, multi-asset funds do pose their risks. Some in the industry warned about the risks of a mismatch in investment goals and fund objectives. 

This means some advisers may be choosing multi-asset funds that are not in line with the client’s understanding of the fund’s objective. 

But how can multi-asset funds be helpful to investors in this volatile economic landscape? 

The report, which can be read by clicking the link in the image above, qualifies for an indicative 30 minutes' worth of CPD. 

saloni.sardana@ft.com 

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. Absolute Return funds are able to "short-sell" stocks and bonds, true or false?

  2. What does Ms Sillers believe is the key way to be investing in current uncertain market conditions?

  3. For what reason does Mr Waite say he dislikes Absolute Return funds?

  4. How have Quantitative Easing (QE) and historically low interest rates changed the correlation between bond and equity markets?

  5. Why does Mr Cutler think gold is an attractive investment at a time when other assets are expensive?

  6. What type of funds from Miton's range do advisers tend to buy according to Mr Jane?

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You have successfully answered all the questions correctly, well done!

You should now know…

  • List the diversification benefits of multi-asset funds
  • Describe what investing in a multi-asset portfolio entails
  • Explain the risks of multi-asset funds

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