We profile the most interesting fund launches in recent weeks and examine the performance of one product a year after it hit the market.
MULTI-ASSET
The popularity of multi-asset funds has steadily increased in recent years as investors look for products that can offer returns in spite of an uncertain market environment.
BNY Mellon Investment Management, which works with a number of autonomous investment boutiques, has launched the Newton Multi-Asset Income Fund with the aim of providing monthly income and the potential for capital growth over the longer term.
The fund will be co-managed by Paul Flood, manager of the Newton Multi-Asset Diversified Return Fund, and Nick Clay, manager of the BNY Mellon Global Equity Higher Income Fund. It will aim to find opportunities across a range of asset classes and capital structures, with a focus on sustainable income and the potential for capital growth.
Newton Investment Management has experience in both multi-asset and income investment strategies, managing £20.9 billion (€27.7 billion) in multi-asset and £12.2 billion in income strategies from a total £51.3 billion in assets under management.
INDIA EQUITY
As the world’s fastest-growing democracy with the youngest working population, India provides many different investment opportunities.
Seeking to capitalise on this, active investment manager GAM, has launched an India equity fund, which will be run by Mumbai-based investment adviser New Horizon.
The GAM Star India Equity fund will aim to preserve and grow capital by investing in publicly listed Indian companies that are selected on a three to five-year investment view.
The fund follows a bottom-up investment process that focuses on original idea generation and company research to identify significantly undervalued, good quality, well-managed companies operating in sound industries.
Companies are selected either for their ability to produce predictable, stable earnings or for their ability to provide strong long-term returns through growth from depressed prices. The portfolio is designed to produce returns independently of the often highly volatile Indian market cycles.
UK PENSIONS
Asset management firm Schroders chose to respond to the UK government’s changes to pension schemes in January this year by launching the Schroder Flexible Retirement Fund.
The fund is designed for individuals approaching retirement and will give pension scheme members the flexibility to take their pension pot as a lump sum for the purchase of an annuity, or to drawdown over a period of time depending on their individual circumstances.
The fund combines an actively managed multi-asset portfolio and a systematic downside risk management overlay, to target an above-inflation return while reducing the likelihood of significant loss.
It aims to deliver a return of 2% above the Consumer Price Index over the business cycle, and targets a maximum loss of 8% over any investment period.
FRONTIER MARKETS
East Capital is an asset manager specialising in emerging and frontier markets. Currently covering frontier markets in the Balkans, the Baltics and Asia, the firm is looking to leverage its regional expertise into a combined global frontier strategy with the launch of the East Capital (Lux) Frontier Markets fund.
The fund is focused on young and fast-growing markets, with an emerging middle class and strong consumption growth. This wider investment area for East Capital aims to take advantage of growth in a spectrum of countries, sectors and companies, creating a high risk-adjusted yield.
Other important factors for the fund’s investment strategy include a strong and sustainable growth outlook, favourable demographics, attractive valuations and good diversification.
The fund’s strategy involves bottom-up stock-picking through a research-driven, long-term and local approach, with a particular interest in off-index countries.
ONE YEAR ON
In January 2014, Threadneedle Asset Management launched its UK Social Bond Fund in partnership with social investment organisation Big Issue Invest.
The fund has daily liquidity and is available to retail and institutional investors in the UK. It aims to deliver socially responsible financial returns by investing in fixed income securities that focus on achieving and supporting positive outcomes for individuals, communities or society as a whole.
The fund’s one-year performance for 2014 was 11.1%, with housing and property, and health and social care as the greatest sector weighting in its portfolio. Top holdings include the Sanctuary Housing Association, which provides rented, sheltered, home ownership and care home accommodation across England and Scotland.
The fund’s first Interim Social Performance Report, released in October 2014, reported that it had raised and invested £28.1 million in 59 bonds from 46 UK issuers.
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