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Axa IM’s Marwood sitting on cash

Axa Investment Management fund manager Richard Marwood is waiting on bond markets to improve before reinvesting newly released cash.

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Axa Investment Management fund manager Richard Marwood is waiting on bond markets to improve before reinvesting newly released cash.

Marwood, who is fund manager of Axa’s Distribution range, holds government index-linked gilts within his portfolio.

The range usually holds 3 per cent cash as a “neutral weighting” but following maturities in August, the £929m Axa Distribution fund currently has 5.8 per cent in cash, the £721m Defensive Distribution fund has 8.8 per cent in cash and the £113m Ethical Distribution fund has 7.4 per cent.

Marwood says: “We did not buy back into the bond market heavily because it was not that cheap. We are waiting and might dribble more in.

“There are concerns about holding onto it too long. We are hoping to reinvest by the end of the year.”

Chase de Vere head of communications Patrick Connolly says: “It is incredibly difficult for fixed interest managers right now. Either they can invest now, and may not got the best value, or they can wait on the sidelines for conditions to improve.

“In the long term there is a risk in holding that much cash. Investors and advisers need to be aware from the outset that is the approach the fund manager is taking.”

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