Ingenious says the fund was launched in response to IFA demand for access to the Ingenious investment strategy of limiting losses in falling markets using an Oeic structure. The Ingenious investment process is built around the belief that clients are averse to losses and not necessarily averse to risk. The company also thinks global multi-asset investing will provide the best returns and that investing through funds can improve return and reduce risk.
The new fund aims to outperform cash over rolling five-year periods by investing in equities and bonds through a portfolio of investment funds, including investment trusts and exchange traded funds. The fund can also hold other asset classes such as commercial property and commodities where this helps to produce better risk-adjusted returns.
Ingenious chief investment officer Guy Bowles, who has over 25 years’ investment experience, manages the fund. He specialises in global multi-asset portfolios and quantitative analysis of investment risk.
The fund will benefit from the efficient frontier, a risk modelling tool which identifies sources of risk in the portfolio and recommends strategic allocations, or the best asset mix to provide the highest returns for any given level of risk. This is useful when looking at how to improve returns in the portfolio with no extra risk or how to achieve the same level of return with less risk. The tool also ensures that only intended risks are taken and that unintended risks are not taken.
The efficient frontier tool does not prevent Ingenious from making tactical asset allocation changes to the portfolio. These changes will be based on economic factors, potential risks and market moves or specific fund ideas.
F&C’s lifestyle funds of funds, managed by Thames River Multi-Capital’s Gary Potter and Robert Burdett, are run on a similar basis in that strategic asset allocation is built around efficient frontier models from an independent company, Distribution Technology. Some investors may opt for F&C because of its brand name and range of four risk profiles, which span defensive, cautious and balanced as well as growth risk profiles.