The launch is an example of Russell‟s industry leading approach to deliver specific investment outcomes for different client segments, including institutional investors and the financial planning community.

MAGS demonstrates Russell‟s innovative thinking in the creation of outcome-oriented, actively managed funds, and is the latest in a series of customised solutions for the Australian market. The concept has been launched by Russell in the UK, France and Italy with more than $AUD1.8billion currently under management and similar products are planned for other regions, as part of Russell‟s global shift towards outcome-oriented investing.

The strategy aims to deliver long-term capital appreciation equivalent to equity-like returns, but with less volatility than an equity portfolio.

With a focus on the end investor‟s desired outcome, MAGS aims to achieve positive returns that exceed inflation by 4% over a full market cycle.

Russell has already had strong interest in the MAGS concept from insurance companies, defined benefit funds, not-for-profits and superannuation funds, who recognise that traditional fixed income returns won‟t be adequate in the long term, but are not comfortable with the volatility inherent in large equity exposures.

An advocate for outcome-oriented investment portfolios that focus on investors‟ objectives, rather than beating a peer benchmark, Russell believes a paradigm shift is occurring in the way global and Australian investors approach portfolio design.

“In the wake of the global financial crisis, institutional investors and financial advisers have been looking for intelligently constructed portfolios that will deliver the right outcomes for their members or investors, whatever the performance of markets, and whatever the person‟s particular set of needs are,” said Russell Chief Executive Asia Pacific, Alan Schoenheimer.

MAGS is actively managed and has an investment philosophy that breaks free from the static „set and forget‟ approach taken by traditional balanced funds. By incorporating customised asset exposures, adaptive asset allocation and holistic portfolio construction, the portfolio manager can add and remove different components so the Fund in total is appropriately positioned for the market environment at any point in time.

In the current market environment, MAGS is defensively positioned with yield-seeking as a focus across the portfolio. US and emerging market exposures are favoured in both equities and currency. Defensive asset class strategies have been fully de-coupled from traditional benchmarks. Opportunistic credit and emerging market exposures are emphasised, while traditional interest rate exposures are de-emphasised.

MAGS launch opens the door to new institutional and retail alliances

In February, Russell unveiled a new alliance approach to help Australian investors access outcome-oriented solutions and drive the continued growth and direction of the business in the region. The new alliance approach will see Russell seek partnerships with large institutional investors and selected financial adviser groups to develop customised portfolios designed to meet specific outcomes for individual investors. One of the most commonly discussed outcomes is retirement income.

“Today our clients are telling us they want investment solutions that start with the real goals of their investors. In response, we are partnering with institutional investors and selected financial adviser groups to open up access to Russell‟s world-class capabilities and develop highly customised portfolios designed to meet the specific outcomes of those investors,” Mr Schoenheimer said.

Russell’s unique capabilities span five critical areas; capital markets insights, manager research, portfolio construction, indexes and portfolio implementation.

“Russell is one of the few firms with the unique breadth of capabilities necessary to meet client expectations in this area. The quality that makes Russell unique is our ability to holistically integrate each of these components in ways that deliver truly tailored outcomes based on clients‟ real needs,” Mr Schoenheimer concluded.

The post New multi-asset Fund targeting equity like returns with lower volatility – now live appeared first on AdviserVoice.