Barclays Wealth has unveiled the full details of its new global markets proposition, saying the multi-asset range will consist of five risk-rated funds that will invest only in exchange-traded funds.
The group says the UK-domiciled Oeics will offer ultra-low fees and tap into the trend in the IFA market towards outsourcing asset allocation work ahead of the Retail Distribution Review.
IFAs are increasingly placing their clients in risk-rated funds to ensure clients’ assets are being managed appropriately while freeing up time for the extra client-facing and compliance work expected to come under RDR.
The launches – set to take place on Monday – represent the first foray into running open-ended funds by the provider, which has previously offered only structured products.
The funds will invest mainly in iShares ETFs – tracker funds that are traded on the stock exchange – based on developed and emerging market equities, short and long dated government bonds, investment grade and high yield credit as well as alternatives, real estate and commodities.
The lowest-risk rated funds will have a higher allocation to cash and low-risk assets like government bonds.
In addition there will be a degree of active fund management by Barclays Wealth to adjust the funds’ weightings towards the ETFs based on market expectations, in line with a new strategic asset allocation model the group has developed.
Barclays Wealth director Tony Lanser says: “We spent a lot of time and resources developing the new SAA model. It is based on a tracking error methodology. We are confident it is going to be successful.”
The funds will all have an annual management charge of 1 per cent, with the total expense ratios on the funds expected to range between 1.35-1.65 per cent based on their risk ratings. Initial commission for IFAs will be 4 per cent.