The new fund aims for growth with low volatility by investing directly in a range of asset classes including equities, corporate and convertible bonds, government bonds and currencies. The managers take a flexible approach to asset allocation with the aim of reducing the impact of any major downturn. They select assets that they see as providing the best risk and reward trade-off, but tend to avoid structured products and third party funds.
Portfolio managers Miles Geldard and Lee Manzi joined Jupiter in 2010 and have worked together for 14 years. Their investment style combines top-down strategic asset allocation with the bottom-up selection of individual securities.
Defaqto insight analyst for funds Fraser Donaldson says: “This is a multi-asset fund designed to achieve positive returns in all market conditions. There is no doubt that clients and advisers do have an appetite for investment solutions that can potentially dampen downside risk, while at the same time have the potential for decent upside returns.
Multi-asset does mean that the managers are not exposed solely to long only positions and can use shorting and derivative overlays to hedge away some risk and lower volatility. The core of the portfolio, selected on a global basis, is structured top down, but with fundamental securities analysis. Ucits III powers mean that the fund managers can still be conviction managers taking bets on currency, securities or indices.
This may lead to occasional periods of higher volatility but also affords the fund managers options for positive returns when all asset classes look as if they are both closely correlated and suffering from negative sentiment.
The fund managers have chosen not to include third party funds or structured products. This is not a restriction, as the managers can place their own positions with derivative overlays, and judge they have the expertise in-house not to rely on the decision making of third party fund managers. This stance should both save on cost and increase control in the fund.”