Tilney for Intermediaries has launched a new suite of five risk-rated multi-asset UCITS OEIC funds, the IFSL Tilney Bestinvest Advanced Passive Portfolios (APP) with a fixed price offer period on each fund of 100p per share from 1 February to 15 February.
The APP funds will be co-managed by Gareth Lewis (pictured), Chief Investment Officer, and Ben Seager-Scott, Director, Investment Strategy.
Aimed principally at UK financial advisers and their clients, the APP funds will combine an active approach to asset allocation with investment through both the new generation of Advanced Passive, or ‘smart beta’, passive investments and low cost trackers. The range will provide advisers and their clients with a series of low cost core investment solutions, but without the limitations and inherent underperformance of exclusively using traditional passive strategies that weight holdings solely on market-capitalisation. Each fund will have a 0.65 per cent annual management charge with the OCFs capped at 1 per cent. The minimum investment for each fund will be GBP1,000.
The five strategies each align to the profiles of leading independent risk-profiling firms Distribution Technology and Finametrica. The funds are Cautious, Balanced, Growth, Aggressive Growth and Income and will replicate the asset allocation approach on sister funds in Tilney Bestinvest’s existing GBP1 billion strong Multi-Asset Portfolio fund range, each of which has delivered significant outperformance over their ARC benchmarks. The APP funds will be available on Aviva Wrap & SIPP, Pershing, SEI and Transact from launch, with further platforms in the process of being added.
Gareth Lewis, Chief Investment Officer and co-manager of the funds, says: “In our view the emergence of the new generation of ‘alternative beta’ and ‘smart beta’ passive funds is one of the most significant and exciting developments the investment management industry has seen in two decades. These advanced passive investments greatly enhance the scope for investment managers like us to express active asset allocation views in a much more granular way than has been previously possible through use of traditional index funds. As the recent market turmoil and slide in commodity stocks reminds us, there are serious drawbacks in investing solely through traditional passive products, as these leave investors fully exposed to losses in a declining market but also the risks of sector valuation bubbles in rising markets.”
Miles Robinson, Head of Tilney for Intermediaries, says: “We have listened to the views of financial advisers who are hungry for lower-cost managed solutions for their clients but who also recognise the limitations of existing passives-only products that exclusively invest through market-cap weighted trackers. The APP funds are a genuinely innovative solution that enables investors to access the benefits of a truly active and successful approach to asset allocation, with use of lower-cost instruments to provide a series of risk-rated, cost-effective multi-asset solutions.”