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McQuaker adds property to multi-manager funds

Henderson Global Investors head of multi-asset Bill McQuaker is investing in property funds across his portfolios for the first time since the credit crisis as an alternative to low yielding bonds markets.

McQuaker says the yield available on bricks and mortar looks attractive. Unlike bond markets, it is not a ‘crowded trade’ as investors have not returned to commercial property after the bust of 2007.

He believes there is little value anywhere in the bond market. Where he is invested in bonds, he is choosing flexible bond funds without excessive exposure to high yield, including strategic bond funds from Henderson, Jupiter and Old Mutual. He is also favouring short duration bonds.

McQuaker was speaking as Henderson announced the launch of two further funds in the group’s Core Multi-Asset Solutions range. On 10 May, the group will add the Core 4 Income fund and Core 6 Income & Growth fund to the existing Core 3 Income and Core 5 Income funds. The Multi-asset solutions range will now cover Distribution Technology’s risk profiles 3, 4, 5 and 6.

The portfolios will have an initial estimated yield of 4.3 per cent for the Income fund and 3.5 per cent for the Income & Growth fund. The latter has a higher risk tolerance and the strongest capital growth potential. All the portfolios invest in a mix of active and passive funds, incorporating a number of Henderson’s in-house funds to keep costs lower.

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Skerritt Consultants head of investments Andy Merricks says it is good to have some exposure to property funds particularly in a multi asset portfolio. He says: “As an income play and as a bricks and mortar play, it is probably not a bad time to be looking at it because of the yields elsewhere.”

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