How multi-assets could come of age

London-: Multi-asset funds are expected to receive another boost from pensions reforms due next April, which will scrap the requirement for people to buy an annuity with their pension savings when they retire.

Providers of multi-asset ranges are polishing up their income offerings in anticipation of a big new market, boosted by a growing UK elderly population.

Threadneedle launched a global multi-asset fund run by Nangle in July in an attempt to attract pension savers.

Many more asset managers and insurers are expected to launch multi-asset income funds in the spring of 2015.

Some research shows that pensioners may still choose to combine a fund with an annuity, to make sure they are guaranteed some income. But if they look to fund products for the majority of their income, it is all the more important that they are able to choose well.

Many will look to their advisers, but industry voices are unanimous in saying it is still important to understand the underlying strategy — if only to avoid panics when the fund does underperform. That is not always easy.

“Strategies designed to reduce volatility should be appealing to quite a wide selection of the public, but once you look beneath the bonnet and try to understand the strategy, that can be a challenge,” says Hollands.

Nangle believes that whatever the financial wizardry involved, “it’s really important to understand what the fund manager is doing”.

“Ultimately fund managers sometimes succeed and they sometimes fail, and in the medium term, people often get quite rattled,” he says.

“The ability to communicate to investors what’s working and what’s not is actually really important in multi-asset.”

Multi-asset funds are expected to receive another boost from pensions reforms due next April, which will scrap the requirement for people to buy an annuity with their pension savings when they retire.

Providers of multi-asset ranges are polishing up their income offerings in anticipation of a big new market, boosted by a growing UK elderly population.

Threadneedle launched a global multi-asset fund run by Nangle in July in an attempt to attract pension savers.

Many more asset managers and insurers are expected to launch multi-asset income funds in the spring of 2015.

Some research shows that pensioners may still choose to combine a fund with an annuity, to make sure they are guaranteed some income. But if they look to fund products for the majority of their income, it is all the more important that they are able to choose well.

Many will look to their advisers, but industry voices are unanimous in saying it is still important to understand the underlying strategy — if only to avoid panics when the fund does underperform. That is not always easy.

“Strategies designed to reduce volatility should be appealing to quite a wide selection of the public, but once you look beneath the bonnet and try to understand the strategy, that can be a challenge,” says Hollands.

Nangle believes that whatever the financial wizardry involved, “it’s really important to understand what the fund manager is doing”.

“Ultimately fund managers sometimes succeed and they sometimes fail, and in the medium term, people often get quite rattled,” he says.

“The ability to communicate to investors what’s working and what’s not is actually really important in multi-asset.” -

Multi-asset funds are expected to receive another boost from pensions reforms due next April, which will scrap the requirement for people to buy an annuity with their pension savings when they retire.

Providers of multi-asset ranges are polishing up their income offerings in anticipation of a big new market, boosted by a growing UK elderly population.

Threadneedle launched a global multi-asset fund run by Nangle in July in an attempt to attract pension savers.

Many more asset managers and insurers are expected to launch multi-asset income funds in the spring of 2015.

Some research shows that pensioners may still choose to combine a fund with an annuity, to make sure they are guaranteed some income. But if they look to fund products for the majority of their income, it is all the more important that they are able to choose well.

Many will look to their advisers, but industry voices are unanimous in saying it is still important to understand the underlying strategy — if only to avoid panics when the fund does underperform. That is not always easy.

“Strategies designed to reduce volatility should be appealing to quite a wide selection of the public, but once you look beneath the bonnet and try to understand the strategy, that can be a challenge,” says Hollands.

Nangle believes that whatever the financial wizardry involved, “it’s really important to understand what the fund manager is doing”.

“Ultimately fund managers sometimes succeed and they sometimes fail, and in the medium term, people often get quite rattled,” he says.

“The ability to communicate to investors what’s working and what’s not is actually really important in multi-asset.”

— Financial Times