In September, UK inflation figures hit a five-year high of 3% and the RCB fund aims to generate total returns of 4% above inflation a year. To achieve this it will invest predominately in equities over a rolling five-year period at two-thirds of the risk of an equity index.
The fund will be managed by a team led by Nick Hartley, co-head of active equities, and Shaunak Mazumder, fund manager.
Simon Hynes, head of UK retail sales at LGIM, said: “Many investors we speak with are concerned about the spending power of their savings over the long term, and inflation is a rising risk.
“The Real Capital Builder strategy is relevant for a broad range of investors looking for positive real returns via equities, but in a fund where the drawdown risk and volatility of equities are actively managed down.”
Hartley commented: “We have committed significant resources to the design of Real Capital Builder. The fund is managed by a dedicated team of fund managers and analysts, each of whom was hired specifically for the strategy.
“Targeting equity returns with two-thirds’ MSCI World volatility and a real return objective meets the investment objectives of many of our clients for all market conditions.
RCB’s launch follows the L&G Real Income Builder that launched last year and expands the ‘medium capital risk’ products offered by LGIM.
