Multi-manager specialist Miton Investments is planning to establish itself in the IFA market with its fourth fund of funds.
The firm, which was founded in 1986, provides funds of funds and bespoke portfolios to UK and overseas investors, including discretionary portfolio managers.
Its investment team wanted to build up a track record before rolling out its funds to the wider IFA market.
The new CF Miton special situations fund is based on a pension fund that Miton has managed since 1998. The Investment Management Association has allowed the existing fund's track record to move across to the balanced managed sector.
In common with Miton's other funds of funds, the new fund will take a defensive core and aggressive satellite approach. Defensive assets such as cash and gilts will provide a low volatility base, enhanced by around 30 per cent in special situations funds, including investment trusts, that are exposed mainly to equities.
Miton's investment team believe the use of benchmark indices increases volatility and limits diversification so they will measure performance relative to the balanced managed sector average.
The fund will soon be available through Canada Life International's investment bond and Miton is also looking to develop a relationship with Canada Life onshore.
Fund of funds manager Sam Liddle says: “Asset allocation contributes more to fund performance than fund selection. Your fund can hold the best performing UK fund but it is no good if that market is falling. The special situations fund of funds will be looking for managers that do well in a bull market, not a bear market, because if we do not like a market we will not put money into it.”