Fidelity’s director of asset allocation Trevor Greetham manages the multi-asset defensive and multi-asset growth funds. Greetham has 18 years’ investment experience, including 10 years at Merrill Lynch.
Multi-asset defensive is aimed at investors who are looking for steady growth and capital preservation, while multi-asset growth is aimed at those looking for equity-like returns with lower volatility.
Both funds benefit from diversification across cash, bonds, property, equities and commodities. Greetham will tilt the asset allocations to suit changing economic conditions and the risk and return profile of each fund.
The defensive fund will have a higher allocation to cash and bonds relative to the other asset classes, with 65 to 100 per cent in cash and bonds and up to 35% in shares, property and commodities to enhance growth. The growth fund reverses these weightings to reflect the higher risk profile of the fund. The portfolio invests 65 to 100 per cent in shares property and commodities, with up to 35 per cent invested in cash and bonds. This asset mix is designed to lower volatility, so the manager will allocate to cash and bonds at relevant points in the economic cycle to reduce volatility, while still producing returns that are similar to equities.
Greetham will draw on research from Fidelity’s Asset Allocation Group to identify the current stage of the economic cycle and what mix of assets is most appropriate for each stage.
Recent research byfinancial technology firm 1st-The Exchange showed that 35 per cent of the 175 IFAs surveyed expect multi-asset funds to be the most popular type of investment this year, so this launch could be at the right time,
Many companies such as Swip, Insight, Cazenove, Premier and Apollo have established multi-manager multi-asset funds in the same sectors, but the Fidelity brand is likely to draw in support for the new funds.