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Form of defence

For the next Adviser Fund Index rebalancing on November 1, 2006, panellists are concentrating on both risk levels and individual fund performance.

Ben Willis, investment manager and head of research at Whitechurch Securities, has made a number of fund changes in his AFI portfolios, each relating to risk.

In the cautious portfolio, Willis is moving into the Lazard UK alpha fund because he wants to be more defensive. He says: “We have a fair exposure to some distribution funds. We’ve cut back on the Jupiter distribution and Gartmore cautious managed funds and moved it into Lazard. We are looking at defensive markets in light of any global slowdown.”

Willis says that over the next six months, large caps will outperform and provide better value and better returns. “They will provide better value than UK small and mid caps,” he says.

Again, in an attempt to reduce risk, Willis is removing the SG American growth fund and is replacing it with UBS American equity. He is doing this because he wants to have more of a “core holding, lower down on the risk scale”.

Whitechurch is also moving the New Star European growth fund from its balanced into its aggressive portfolio recommendations. It is adding the Artemis European growth fund to its balanced portfolio and removing the Fidelity European opportunities fund from the aggressive AFI.

The group sold out of Fid-elity European opportunities because it wanted to move into a less risky European fund after the market correction, says Willis.

“Because of the market correction and our belief that the global and European economies are set to slow, we decided to move into a less risky fund, with a greater bias towards mid and large-caps,” he explains.

Brian Dennehy, managing director at Dennehy Weller & Co, says the weightings in terms of risk remain the same across his portfolios.

Dennehy is changing his holdings for different reasons. In the higher-risk spectrum, he is switching from the Schroder Tokyo fund to the Jupiter Japan income fund.

In the medium risk part of the portfolios, he says he continues to like the Jupiter income fund but is moving some money out to the Newton higher-income fund in the balanced and aggressive portfolios.

In the lower risk portion of the portfolios, Dennehy will will retain the current split and fund choices. He is doing this both for diversification purposes and because of the threat of an economic slowdown.


Openwork lines up with-profits deal with Pru

Openwork is lining up a single-tie agreement with Prudential to sell its with-profits bonds, Money Marketing understands. The two companies are thought to be in advanced discussions and an announcement is expected later this month following a “rigorous” tender process. The deal will represent Openwork’s first venture into with-profits bonds since it was formed last […]

Options E to H are favoured in review

The FSA says the majority of responses to the Financial Ombudsman Service funding review favoured options E to H, where advisers get between five and 10 free cases with an increasing flat fee.

Sense of clarity

With both the Law Commission and the Scottish Law Commission taking an interest in the effect of non-disclosure on claims, it’s likely that we will see a step change in the way non-disclosure is dealt with.

Matter of trust

Investment trusts have several advantages over unit trusts. Most investment trusts have beaten inflation over the past 10 years – and many of them both in terms of income and growth.

Cricket - thumbnail

England vs Australia: pensions

Well, the cricket season is here, and England and Australia are stepping up to the wicket. Although we compete with each other in the sporting world, when it comes to pensions, Australia’s pension programme is held up as a model for our auto-enrolment initiative. Auto-enrolment was introduced because people weren’t saving enough into their pensions, and it is still early days but signs are positive. However, in Australia, saving into a pension is compulsory, and in fact employers are the ones who have to pay in. Employees in Australia can make additional contributions into their pensions, but they don’t have to. Should the onus be on the employer or employee to save? Well in the UK we think it’s both, but to get ‘adequate’ savings for retirement it’s the employee who has to pay more in.


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