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Skandia looks to GDP growth to benefit dynamic fund

Skandia says that using gross domestic product growth rates rather than index weightings in geographical asset allocation should help its multi-manager global dynamic equity fund to outperform.

It says GDP provides an up to date measure of economic growth around the world which is more useful than backward-looking stockmarket indices such as MSCI.

Although there was a high correlation between different countries at the end of last year, when they all fell as the financial crisis hit hard, fund manager Ryan Hughes considers that the benefits of diversification will be felt by investors over the longer term as regions and asset classes outperform over different timeframes.

Skandia has employed specialist institutional managers to pinpoint opportunities. Investment groups running the US part of the portfolio are Marsico, Epoch, QMA and Acadian.

Hughes says: “We have a big team with lots of resources and this enables us to employ institutional managers who want to work with Skandia. We have four managers in the US that differ in style and approach. They are institutional managers who have made the decision not to manage retail funds and have excellent track records in their own specific areas.”

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