By Spectrum IFA
This article is published on: 16th October 2019
I have spoken about asset allocation and rebalancing and their affect on your investments. An-other strategy that is available to you is multi asset fund management.
You may have heard (read) that I have mentioned that here at The Spectrum IFA Group, we favour the ‘multi asset fund’ route of investing. But, what is that?
Multi asset funds provide you with access to multiple funds and asset classes through a single fund, managed and monitored by dedicated experts on your behalf. This type of fund can increase the potential for diversification and help reduce the overall level of risk.
Choosing the right funds and building a diversified portfolio can be extremely difficult. The options available to you are almost limitless, with tens of thousands available to investors in Europe alone.
Generally speaking, it is highly unlikely that a single fund manager is capable of delivering consis-tent outperformance, year on year. Making the right choice for a portfolio and then refining it and rebalancing it over the years takes time, information and skill. Therefore, fund managers need to be monitored to ensure they remain at the top of their game – and replaced when they are not. The resources and/or expertise to do this properly can be time consuming and expensive. There-fore, multi asset funds can play a valuable role in part or all of your investments.
All multi asset funds offer a convenient way to access a wide range of fund managers and asset classes. Spreading investments across a wide range of managers and assets reduces the proba-bility of a fall in value across the whole portfolio.
At the same time, multi asset funds that are designed to target different risk levels make it simple to adapt a portfolio to suit your changing circumstances. For example, if you have no need to ac-cess your savings any time soon, then you are likely to be able to take more risk than clients who are nearing the time when they do need to access their money.
