The Invesco Perpetual Balanced Risk 6,8 and 10 funds will be managed by the Invesco global asset allocation team, based in Atlanta, and led by CIO Scott Wolle.
In recent weeks the move towards multi-asset expansion has gained momentum, with Fidelity adding a fund to its multi-asset range, while Aviva Investors launched two new funds to its range and stated its intention to concentrate on the multi-asset element of its investment proposition.
Baring Asset Management has also said it plans to concentrate on new launches in the multi-asset space and Barings former multi-asset director, Toby Nangle, joined Threadneedle at the start of this year with the intention of building a multi-asset offering there.
In a recent PA Analysis, we looked at the growth of multi-asset offerings ahead of RDR and the competition discretionaries would face from this move. To read it, click here.
Invesco Perpetual’s offering
Invesco Perpetual’s portfolios will be exposed to equities, bonds and commodities and risk-rated across asset classes and within them – stepping away from the more traditional method of risk-rating portfolios by their amount of equity exposure.
In addition, the funds will aim to reduce volatility while maintaining equity-like returns.
"Traditional balanced or multi-asset solutions typically combine the defensive properties of bonds with the growth potential of equities. However, because of their higher volatility, equities can often represent a disproportionate amount of portfolio risk," Invesco Perpetual explained.
The team’s investment strategy employs proprietary quantitative models built on fundamental research which have been back-tested from 1973 to 2008.
It strategy also involves three steps: asset selection, portfolio construction and active positioning.
Investment Strategy
Through asset selection the team will aim to construct portfolios that can perform well in different market conditions, which it said means having assets with a low degree of correlation.
Then, within the three main asset classes, the team hopes to gain exposure to 16 underlying assets in its portfolio construction.
Finally, the team will use active positioning to attempt to capture additional return by taking advantage of short-term market anomalies. The aim is to capture 15% to 20% of the funds’ target return through the use of this active positioning.
Craig Newman, Invesco Perpetual’s sales director, said: "Clients tell us managing risk is one of the biggest challenges they face in the current climate, so we decided to look for an innovative investment approach that would allow us to deliver products which could be matched to clients’ different attitude to risk and volatility. We believe this is a compelling concept for the market."
