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Snowdonia Fof gets new benchmark

Buckles has changed the composite benchmark of its Snowdonia growth fund of funds as it felt the previous benchmark did not reflect the portfolio’s global remit.

The fund, managed for Buckles by UBS Wealth Management, was launched in 2004 with a benchmark comprising 50 per cent FTSE All Share index and 50 per cent MSCI World ex-UK index.

The investment committee decided to change it as the composite did not include emerging markets and was too focused on the UK for a global growth fund.

It now comprises 35 per cent FTSE All Share, 45 per cent MSCI World ex-UK and 25 per cent MSCI Emerging Markets index.

Buckles believes it is important to use benchmark indices to manage risk effectively even though many managers prefer to use the sector average as an indication of performance.

Business director of the Snowdonia fund Rick Eling says: “We believe benchmarks work. Investors want the comfort of knowing there is a benchmark and IFAs like to feel that risk is managed by an independent party. We will take as much risk as the benchmark and we do not follow the herd.

“Without a benchmark, all you get is managers trying to outdo each other by beating the sector average and that is how you get more risk creeping into sectors.

“Some of these fund managers might be at the top of their sector but they are just chasing each other. If we underperform the sector average but with lower risk, it does not matter to us, we are quite happy with that.”

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