Sanlam-owned global investment business P2international is launching a discretionary fund management service on the Nucleus platform.
The service aims to provide capital protection and will have around seven risk-profiled model portfolios; six growth portfolios and one income portfolio. Asset allocation will be determined by Morningstar.
A risk management overlay will be added through a partnership with US firm Milliman. An automated systems will determine a client’s allocation to cash, typically between 10- 20 per cent, and select the most suitable portfolio. The allocation will be balanced on a daily basis according to the volatility of market movements.
The fee for the service is 0.75 per cent, alongside fund and platform charges.
Sanlam Global Investment Solutions managing director and P2 chief executive Cobus Kruger says the strategy will cut volatility by half on average.
He says: “This service will significantly reduce volatility and minimise the extent of drawdown.”
Nucleus chief executive David Ferguson says: “This is a new approach to the way capital protection works on investment products and how it applies to people on an individual level, rather than a one-size-fits-all basis.”
Informed Choice managing director Martin Bamford says: “This type of service will appeal to advisers who lack the scale or resources to create their own investment proposition in-house. Using such a service should provide a compliant solution for advisers.”