Reasons Why to Invest - SWIP Multi-Manager Diversity Fund

Asset allocation

The SWIP Multi-Manager Diversity Fund aims to outperform inflation, as measured by the Consumer Price Index, by 4% so that your investments increase in real terms.

The Fund does this by investing in a diverse range of asset classes including equities, bonds, cash, commodities, property and other alternative investments to exploit the often low correlation that they have with one another. This is a much wider variety of asset classes than would be available through a traditional cautious or balanced managed fund.

Therefore, you can gain exposure to a range of assets which can help to reduce volatility by smoothing out the peaks and troughs in the market. The Fund aims to take advantage of the rises in the markets, while limiting the downside when markets fall.

As shown in the chart below, the Fund spreads its investments across various asset classes to diversify and spread risk. Typically, the managers use equities to generate returns, bonds to offer protection and ‘alternative’ assets, such as property, infrastructure, commodities and hedge funds, for diversification and growth.

Asset Allocation

Fund selection

The SWIP multi-manager team has a rigorous and proven investment process to research and select funds, researching over 10,000 funds through a quantitative and qualitative screening process. What’s more, the team is able to focus entirely on researching the thousands of funds in the market place to deliver a more consistent return and reduce risk.

The team looks to understand how performance has been achieved – the potential for it being repeated again in the future – and how the Fund will blend into the portfolio. The team conducts over 300 fund manager interviews a year to gain in-depth insight into a fund manager’s process, style and their ability to adapt to varying market conditions – as well as the types of stock the fund manager will invest in. This builds a clear picture of each fund before selecting the right combination of funds to meet the portfolio’s objective.

Additionally, the managers meet face-to-face with individual fund managers and have access to funds that are often not available to you as an individual, which means you can benefit from investing in a number of funds with only one administration cost.

The team

By investing in the SWIP Multi-Manager Diversity Fund, you will benefit from a skilled team of individuals.  SWIP’s core multi-manager team of five have worked together for the last seven years and have been joined by an additional three analysts.  Between them, the team of eight can call on over 159 years’ of fund analysis and selection experience.

The two lead members of our team are Mark Harries and Simon Wood, who both joined SWIP in 2007. Each has over 20 years’ experience and is A rated by Citywire (Source and copyright: Citywire, for three-year risk-adjusted returns from 28 February 2008 to 28 February 2010).

Each member of the team is a specialist in their own right and focuses on specific sectors and/or asset classes. Plus, the team has access to research resources from across SWIP’s investment desks to provide them with a wealth of information and insight to the markets and individual managers’ strategies.

Important information

The value of investments can go down as well as up depending on investment performance. You may not get back your original investment. Funds may have holdings which are denominated in different currencies and may be affected by movements in exchange rates. Consequently, the value of your investment may rise or fall in line with exchange rates. Investments in emerging markets may involve a higher element of risk due to less well regulated markets and political and economic instability. Tax rules relating to OEICs may change.

Multi-manager funds can invest in a wide range of asset classes, including collective investment schemes, which they themselves invest in a range of other assets. These underlying assets are likely to vary from time to time but each category of asset (which may include, but shall not be limited to, hedge funds or property) has individual risks associated with them. Multi-manager funds and the Manager may not have control over the activities of any collective investment scheme or company invested in by Multi-manager funds. Managers of collective investment schemes and companies in which the Multimanager funds may invest may take undesirable tax positions, employ excessive leverage, or otherwise manage the collective investment schemes in a manner not anticipated by the Manager.

Further details of the risks relating to the SWIP Multi-Manager Funds can be found in the Key Features Document which must be read before taking any investment decision.