View more on these topics

Multi-managers are wary of fixed interest

A number of leading multi-managers are becoming increasingly bearish about fixed interest and are favouring cash holdings in their cautious managed portfolios.

Cautious managed funds can hold up to 60 per cent in equities with the balance held in cash and bonds.

Gartmore has reduced its fixed-interest weighting to 21 per cent with deputy head of multi-manager Marcus Brookes claiming equities look safer than bonds in the current economic climate. He says: “As it stands, equities look a far safer bet than fixed interest as market conditions mean that you are likely to lose money with bonds at the moment.

“Interest rate rises and the effect of private equity continue to see bonds downgraded while the price looks overvalued.”

Jupiter’s John Chatfeild Roberts has increased the cash exposure in his Merlin income portfolio to 20 per cent while Schroders head of multi-manager investment Andrew Yeadon holds 20 per cent in fixed interest with 17 per cent in cash.

Yeadon says: “It has been a problem in the market for some time and, with rates now at 5.5 per cent, there is still more value in a cash investment as opposed to fixed interest, with gilts so tremendously overvalued.”

T Bailey fund manager Jason Britton says: “We have dropped our fixed-interest exposure to 20 per cent. Bonds are an asset class which is so overvalued and has little or no alpha so we have to be as flexible with our investments as possible.”

Recommended

Plan of action

If one of your business clients called you a hypocrite, would you have a leg to stand on?

A Shaw thing

Sam Shaw is a reporter on Money MarketingHaving enjoyed the hen weekend to top all hen weekends in the company of the stunning Ali Merrigan from Lansons, I should have planned a nice quiet week. Alas, duty calls and press day was topped off with F&C’s annual summer party at Bar Bianca in Piccadilly.The place […]

Back to the Future

One MM hack had blonde moment at The Future of Life Assurance conference last week when, after registering for what she thought was the correct meeting, she walked into a conference room surrounded by a sea of film cameras, press, photographers and delegates.Expecting to see Ned Cazalet speaking, she was surprised to find that the […]

CurriculumVitae

name: Steve Cox age: 36 company: Spicerhaart Financial Services job title: Operations directorwhere do you live? Surreydescribe your current job: I oversee Spicerhaart Financial Services’ external relationships as well as implementing and heading the relationship with our strategic partner, Sesame. I’m also responsible for the business development of Spicerhaart Corporate Sales and the group’s surveyor […]

Retirement fund - thumbnail

What price (more) freedoms?

George Osborne will make his last Budget speech of the current parliamentary term this week, and the early media briefings suggest that pensions will again feature heavily in that statement. So what are we able to learn from the weekend’s coverage?

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment