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HSBC launches multi-asset funds

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HSBC Global Asset Management has rolled out three new multi-asset funds focused on passives to reduce fees.

The HSBC Global Strategy Cautious, Balanced and Dynamic Portfolios are a set of multi-asset funds which will invest across a number of asset classes and regions.

The Cautious Portfolio will carry a risk rating of three, while the Balanced and Dynamic Portolios will be risk rated five and seven respectively. Jane Davies will be the lead portfolio manager alongside senior product specialist Meike Bliebenicht.

The new funds, which will be available from 16 October through all major platforms, will primarily use passives to keep funds fees low. The ongoing charges for the portfolios range from 0.17 per cent to 0.20 per cent.

HSBC Global Asset Management head of UK wholesale Phil Reid says the products have been created for the “post-RDR environment” as well as for the new pension freedoms.

HSBC research, published today, also reveals that more than 90 per cent of advisers look to multi-asset funds to meet their clients’ risk profile, while 74 per cent look to these type of funds as a cost-efficient investment solution.

The survey, which was carried out with 200 UK advisers between July and August 2015, also shows that the client knowledge of the provider, existing relationship with the fund provider and quality of information on the product were the top reasons for investing in multi-asset funds.

Surprisingly, reduced volatility, fund manager skills and expertise, and the fund’s objective were the least important reasons to chose multi-asset funds.

Reid says: “Our multi-asset fund range uses an active asset allocation process to identify what we believe are each fund’s optimal exposures to equities, bonds and property securities, across both developed and emerging markets.

“This process is re-run at least every three months. Shorter term views can be reflected in the portfolios through tactical asset class weight adjustments. Portfolio holdings are monitored on a daily basis.”

On the fixed income side of the funds, the management team will be overweight corporate bonds and underweight government bonds initially, while equities will be neutral and slightly overweight US equities and overweight Europe and Japan.

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