View more on these topics

Arcturus readjusts safety net after falls

Miton Asset Management says its Arcturus fund has avoided the worst of recent marketturbulence due to positivecontributions from some ofits alternative investments.

Arcturus has not been immune to the falls in equity markets and it slipped by 2.85 per cent in January. However, it outperformed its sector and major equity markets which fell by at least 10 per cent.

Miton says asset class diversity and high levels of cash have protected the portfolio to some degree. Exposure to gold produced double-digit returns while holdings in Schroder agriculture and Quadris teak funds returned around 5 per cent.

On the negative side, two structured products linked to the Japanese market fell through their 25 per cent protection barrier. The way structured products are priced meant that a 15 per cent fall in the market led the share price of the structured products to drop by 7 to 8 per cent. This reflected that the market had to fall by 25 per cent before the share price fell by 25 per cent. However, it meant that Miton saw a rapid descent in the share price when the market fell through the protection barrier.

Miton now insists on higher levels of protection from its structured holdings during volatile markets. It has added another structured product to Arcturus which is linked to a basket of four stockmarket indices. This provides a return of 11 per cent a year and a full capital return unless one of the indices falls by more than 50 per cent – a level of protection it feels more comfortable with.

Fund manager Tom McGrath says: “When we bought the Japanese structured products, they looked like a very good exposure to Japan, with extended upside and full capital protected unless the markets fell by 25 per cent.

“At the time, you do not think the market is going to fall by 25 per cent. The more volatility that is around, the better the returns but the lesson we learnt is that we have to be careful in finding the right structure for choppy markets.”


One for the little guys

The Financial Ombudsman Service was left red-faced last week after a County Court judge ruled that it is wrong to charge an adviser a case fee for a rejected case.

Spinning plates

The past six months have wroughtbig changes in behaviour across lenders, brokers and consumers.Some common trends are emerging among balance-sheet players. Margins have widened as supply has contracted andthere are signs that an intermediary market long-famed for its competitivenesshas become devoid of innovation.

Mortgage bad debts treblefor Bradford & Bingley

Bradford & Bingley shocked the market last week with its profits almost halving after it cut the value of risky assets.Underlying pre-tax profitfell to 126m in 2007 from 246.7m in 2006. The newsled to a 10 per cent fall in the firm’s share price.B&B claims that if it stripped out “unusual and extreme external events”, […]

Aon Consulting launches occupational health support service

Pensions and human resources consultancy firm Aon Consulting has launched a healthcare management service for employers. The service offers independent advice on effective provision of internal and external occupational health services.Aon says the launch of the occupational health consulting service is in response to an increased burden on employers to integrate areas such as absence […]

'Feeling the Squeeze'

Royal London carried out a UK wide survey with 2,500 consumers age 35-44 over the summer. The survey found that over a third, 34 per cent, said their finances felt Squeezed and so were struggling to meet day-to-day expenses, despite 87 per cent being aware that they need to save more. However, the survey did […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm