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Aegon unveils defensive multi-manager fund

Aegon has launched an ultra-low-risk fund to protect retirement-age investors’ capital.

The Aegon Stability fund invests in four defensive funds that have complementary portfolios and high levels of liquidity: the Jupiter Strategic Reserve, Fulcrum Diversified Core Absolute Return, Kames UK Equity Absolute Return and Newton Global Dynamic Bond funds.

The Aegon fund aims to beat three-month Libor, after charges, with three-month Libor currently at 0.25 per cent. The fund’s total expense ratio is 0.87 per cent. 

The firm says there is an increasing need for low-risk pension investments to help prevent losses like the 30 per cent fall in global markets following the credit crunch.

The Stability fund is exclusive to Aegon and will be available across all of its advised propositions. Its primary focus is on capital preservation, using absolute return strategies with the aim of generating growth even in falling markets.

Aegon investment director Nick Dixon says: “From April, people will have a lot more control over how they manage their money in retirement. This fund will benefit those savers who want to preserve their hard-earned savings pot and are looking for a straightforward solution, conveniently packaged within one fund.”

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Sorry Nick, but protecting capital isn’t enough. Protecting purchasing power should be the minimum expectation of a retirement age investor taking any degree of risk, whether they’re taking income or not. This portfolio will (at current rates) declare itself successful if it returns 1.12% per annum (OCF, by the way, not TER, plus 3m LIBOR). It might have been more sensible to set a CPI+ target – rather more appealing I would have thought…

  2. And further to Graham’s comment, I don’t see how it even protects capital if 50% of the fund is invested with two managers playing at hedge fund and 50% in bonds (we all know how much security those offered in 2009).

    Half the fund is invested in long/short equity strategies which are presumably supposed to be “uncorrelated” but what it actually means is that you can lose money no matter what the market does if the wrong shares go up and the wrong shares go down. And in exchange for this punt on their clairvoyance you’re supposed to be content if the fund returns… slightly more than well-known star manager Fanny Adams.

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