Scopic Research has added the Orbis Oeic Global Cautious fund and the Schroder Global Multi Asset Portfolio suite to its Multi Asset DNA Research Service.
The service provides multi-asset research to financial intermediaries. For funds to be included, Scopic says it must have access to key investment decision makers, while all portfolios need to pass company, manager, and infrastructure and support tests.
Embedded biases and their likely impacts upon patterns of performance also need to be understood and evidenced.
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The £72.7m Orbis Global Cautious fund first launched in 2019. Managed by Alec Cutler, the strategy is the top performing fund over the last three years in the IA Mixed Investment 20-60% Shares sector, returning 22.6% compared to the sector average 5.3%.
On the Orbis strategy’s inclusion, Paul Ilott, MD of Scopic Research said: “As befits its contrarian style, we might see long periods of outperformance interspersed with equally long periods of underperformance, but with better risk adjusted returns shining through over periods that span the two. Patience and a long time-horizon is required.
“The attention paid to valuations ought to provide a buffer to returns when an asset bubble bursts. It should also help to boost relative returns during a stock market’s initial recovery period, and then later during the cycle when profits growth becomes abundant, and investors are more discerning about the prices they pay.
“In recent years, returns have also been resilient when expectations for inflation have spiked higher. However, the reverse of all of these conditions are generally less helpful.”
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The Schroder Multi Asset Global Portfolio suite houses five risk-rated multi-asset portfolios, all with an ongoing charge figure (OCF) cap at 0.22%.
The range is managed by head of UK multi-asset Phillip Chandler and co-manager Tara Jameson.
“Having access to bespoke baskets of direct securities that are managed in-house to the team’s requirements, and the ability to target assets by using exchange traded futures and FX forwards, affords the team greater precision over positioning when compared to many multi asset peers who invest in funds,” Scopic’s Ilott added.
“The most helpful backdrop for returns is when investors appreciate and act upon market fundamentals, rather than follow momentum and fashionable themes, and when UK and giant-sized global equities outperform.
“In theory, at times of market stress the attention paid to understanding what valuation levels might be considered appropriate for the current phase in the investment cycle, ought to lead to modestly lower drawdowns when compared to peers that exhibit a pronounced growth style.
“As a bull market matures, the team is likely to adopt an increasingly defensive stance as valuations become richer. Under these conditions we might expect the portfolios to lag less valuation conscious peers – including those that invest predominantly in passives. Following a market downturn, the team is unlikely to add back to risk as aggressively as some peers might do.”
