View more on these topics

Henderson looks to barbell

Henderson New Star is taking a barbell approach to equities in its Henderson multi-manager portfolios, with exposure split between funds with defensive and more cyclical qualities.

The company thinks that investing in defensively positioned funds that contain higher quality companies provides an appropriate foundation on which to build portfolios while the economy recovers. Invesco Perpetual income, Brown Advisory US equity value and Henderson Asian values are examples of the multi-managers more defensive holdings.

The team believes changes in monetary policy will not de-rail the recovery, but expects it to slow down cyclical parts of the market, especially those that have no particular investment story apart from economic recovery.

At the other end of the barbell, the team will invest selectively in funds that are a bit more cyclical. There will need to be clear reasons for performance to continue into 2010 and some funds may invest in areas that were unfairly treated last year.

Henderson New Star head of equities Bill McQuaker says Japan is a cyclical market that typically performs well when the global economy is up, but did not follow the pattern last year due to the election and a stronger than anticipated yen. He says the region has a lot of catching up to do this year, along with cyclical parts of the UK market such as aerospace. McQuaker says this sector did not pay handsomely last year, but he expects 2010 to be better and is holding Henderson’s UK equity income fund to gain exposure to aerospace and other cyclical industries.

At the more aggressive end of the cyclical market, McQuaker has some technology exposure as he feels that it is another sector that is likely to have a good year.

McQuaker says: “We are also looking for opportunities to counter trade around our core strategies. When elements perform strongly, we will take them off the table to recycle in to areas that have not done too well. We think this is the right way for trading in 2010.”

Recommended

Bond issues

Returns from government bonds will be negligible over the next decade, with yields expected to reach 10 per cent in the next 10 years, according to Barclays Capital head of asset allocation Tim Bond in the latest Barclays Gilt & Equity study. The 55th annual report, released last week, studies the trends of the past […]

Vision in focus

How many firms are clear about what they offer clients and why they should be their adviser of choice? Take time to sit back with the key people in your company and create your business vision

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    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

    Email: customerservices@moneymarketing.com