Multi-Manager Solutions. Real life investing. F&C MM Lifestyle Funds

Transcription

1 Multi-Manager Solutions Real life investing F&C MM Lifestyle Funds

2 Real life investing 3 Designed to make investing easier 5 Contents Balancing the investment dilemma 6 Aligning you and your investment 8 The F&C MM Lifestyle Funds 10 An experienced team 12 How they manage your money 13 Performance and risk outcomes 14

3 Real life investing This guide is designed to help you understand the F&C MM Lifestyle Funds and the potential role they can play in helping you achieve your long-term financial goals. We aim to help you: Understand the investment dilemma and the importance of balancing risks and rewards Recognise how your adviser can help you select the right fund Understand the F&C MM Lifestyle Funds Learn about the team managing the funds Appreciate how the funds have performed Introducing BMO Global Asset Management The F&C MM Lifestyle Funds were launched in 2007 by F&C, an asset manager with a heritage spanning back over 150 years. In 2014, F&C became part of BMO Global Asset Management a deal that extended and strengthened the investment capabilities and solutions we are able to offer our clients. We are part of the BMO Financial Group which is owned by the Bank of Montreal, Canada s oldest bank established in Today we manage assets for financial institutions, pension funds and private individuals. Whoever the client and whatever their objective, our ambition is to offer the very best investment solutions by drawing on our global capabilities, including those in multi-manager investing. 192bn+ in assets, employees, 20+ offices worldwide Source: BMO Global Asset Management as at 31 December

4 1st in the UK Back in 2007, the F&C MM Lifestyle Funds were the first risk-targeted range launched in the UK. For ten years they have provided a robust option for individuals seeking an investment clearly aligned with their own financial circumstances and attitudes. Introducing risk-targeted funds In this guide, we explore the relationship between risk and reward, including the way investment types offering higher returns potential are often associated with greater levels of risk and vice versa. Risk-targeted funds are built and managed around this dynamic and are constructed with a view to delivering investment returns within pre-defined risk parameters. With a number of funds in the range, individuals can choose an option that meets their requirements. 4

5 Designed to make investing easier With thousands of available options, picking the right investment solution can be a daunting task. Our F&C MM Lifestyle Funds are designed to make it easier. You can select from five carefully managed portfolios and because each fund is specifically risk-targeted, you can invest in a manner that is aligned with the amount of risk you are comfortable taking with your money. While each fund places your money at risk, the five funds have differing risk/reward characteristics. Aligned Your financial circumstances, attitudes and objectives are individual to you. Pick the F&C MM Lifestyle fund that matches your requirements. Make your money work You want your money to work as hard and efficiently as possible. Access to multiple layers of investment expertise and potential. Peace of mind It s important to know that your investment is in good hands. Access a well-diversified portfolio managed by an expert team. 5

6 Balancing the investment dilemma Asked what investment returns you would like and high is likely to be the answer. Apply the same question to risk of loss however, and the corresponding answer is likely to be low. Risk Return Balance Balance the desire for returns with your acceptance of risk by selecting an appropriately targeted portfolio. Choose Invest for real life goals such as growing a lump sum for retirement, building a pot for future income generation or simply to counter the impact of inflation on your savings. Recognise On your investment journey, the desire for returns needs to be balanced with an acceptance of risks associated with investing; you may not get back the amount invested. 6

7 The right balance for you 1 Consider that some investment types offer scope for higher returns. This potential however, is typically associated with higher levels of risk to your capital. Cash Bonds Property Equities Lower risk/lower return Higher risk/higher return 2 Blending investment types into a diversified portfolio can help determine its future behaviour from a risk/reward perspective. Lower risk/lower return For illustrative purposes only Higher risk/higher return The F&C MM Lifestyle range aims to help you balance the investment dilemma through a suite of carefully designed portfolios targeting investment returns within defined risk parameters. 7

8 Aligning you and your investment Your financial circumstances, attitudes and objectives are individual to you. The F&C MM Lifestyle range is designed so that you can pick the right portfolio for you and your requirements. Individuals typically decide which is the best option in conjunction with their financial adviser. Discuss Chat about your financial goals and circumstances with your adviser. Assess Your attitude to risk and capacity for loss is assessed through a risk profiling questionnaire alongside consideration of your objectives. Review Your circumstances and attitudes will likely change over time so it makes sense to regularly reassess your risk profile in conjunction with your objectives. As it alters you can change to another F&C MM Lifestyle Fund. 8

9 2 3 Medium 4 1 Lower Lower potential risk and reward Risk Higher potential risk and reward 5 Higher The F&C MM Lifestyle Funds are mapped to most independent risk profile tools so there should be a fund in the range that meets your needs. Medium Lower Lower potential risk and reward Risk Higher Higher potential risk and reward Your risk profile The F&C MM Lifestyle funds cover the most common risk profiles from lower to higher risk. Invest You can select the F&C MM Lifestyle Fund to align with your profile. 9

10 The F&C MM Lifestyle Funds Our F&C MM Lifestyle range contains five funds with each one aiming to grow the value of your investment within defined risk parameters. Your adviser can help you decide which one is best for your circumstances, attitudes and objectives. At a glance Well-diversified each portfolio contains a range of asset types like equities, bonds, UK commercial property and cash. Asset allocation a specialist third party determines the asset mix. This strategic long-term blend is overlaid with shorter-term tactical adjustments. Fund selection our multi-manager team build the portfolios by picking funds from right across the marketplace. Each portfolio contains over 30 individual funds. Hands on the portfolios are constantly monitored and rebalanced when necessary. This helps keep them within defined risk parameters. Return High Low F&C MM Lifestyle Foundation Fund Lower risk/lower return 10

11 We have continued to develop and improve the F&C MM Lifestyle Funds, building on the core principles of suitable asset allocation, defined risk targeting and active management with a host of enhancements. F&CMM MMLifestyle Lifestyle F&C DefensiveFund Fund Defensive F&C MMLifestyle Lifestyle F&C MM CautiousFund Fund Cautious F&C MMLifestyle Lifestyle F&C MM BalancedFund Fund Balanced F&C MMLifestyle Lifestyle F&C MM GrowthFund Fund Growth 26%UK Equity 35% 31%UK Equity UK Equity 19%UK Equity Higher risk/higher return 5%Europe ex UK 5% 5%Europe ex UK Europe ex UK 4%Europe ex UK 12%North America 7% 9%North America North America 10%North America UK Equity Europe ex UK North America Japan Pacific ex Japan 5%Japan 5% 5%Japan Japan 4%Japan Property 4% Global Yield UK 5% Gilts UKexCorporate Bonds Pacific High ex Japan Japan 16% Pacific exindex JapanLinked Gilts 10%Pacific Pacific exuk Japan 5% Emerging Markets 17% Emerging Markets 11% UK Property 8%Emerging Markets International Bonds Cash 7%UK Property 5% 5%UK Property Global High Yield 6%UK Property UK Gilts 8%Global High Yield 6%Global High Yield 5% 5%Global High Yield Asset allocations shown are for illustrative purposes only. Index Linked Gilts 5%UK Gilts 5%UK Corporate 5% Bonds 19%UK Corporate Bonds UK Corporate Bonds 24%UK Corporate Bonds 24% International Bonds 3% 11 Cash 5%

12 An experienced team The F&C MM Lifestyle Funds are managed by our nine-strong multi-manager team, one of the largest, most experienced and highly regarded in the industry. Rob Burdett and Gary Potter established the team in 1996 and today they manage over 3bn* on behalf of individuals across the F&C MM Lifestyle and F&C MM Navigator ranges. The team have been working together for over 20 years and have managed portfolios through a number of economic and market cycles, including some of the most challenging conditions ever witnessed. Seven other team members work alongside Gary and Rob, providing both breadth and depth of expertise combined years in investment combined years in fund selection years working together * Source: BMO Global Asset Management as at 31 December

13 How they manage your money The team s focus is on creating highly diversified portfolios designed to generate consistent performance through an approach that blends art and science with a large dose of common sense. The big picture Daily and weekly meetings Formal monthly asset allocation review Regular meetings with external economists/ strategists Picking funds The team meets over 400 managers worldwide every year Detailed portfolio and manager analysis Performance assessment and monitoring Building portfolios 30+ individual funds Blending individual components Monitoring and rebalancing Since 2007, the F&C MM Lifestyle Funds have provided individuals with attractive investment returns. Importantly, performance has been delivered broadly in line with defined volatility parameters. Rob Burdett, Co-head, BMO Global Asset Management multi-manager team 13

14 Performance and risk outcomes Through a combination of asset allocation, fund selection and careful portfolio management, our aim is to deliver the best possible investment returns for each risk profile. The chart shows annualised returns and volatility since the launch of the clean share class (B Inc) for each fund. Risk and reward annualised returns (annualised return is the average return each year over a given period) Returns % F&C MM Lifestyle Foundation Fund F&C MM Lifestyle Cautious Fund Volatility % (Risk) F&C MM Lifestyle Defensive Fund F&C MM Lifestyle Balanced Fund F&C MM Lifestyle Growth Fund Source: Lipper Hindsight as at % Growth total return, net of fees, in sterling. Since Launch dates of clean share class as follows: Foundation B Inc , Defensive B Inc , Cautious B Inc , Balanced B Inc and Growth B Inc Understanding the chart Investment returns are shown as annualised percentage growth. Risk is illustrated by the volatility of each fund. Volatility (the rate at which a price moves up and down) is represented by Standard Deviation, which measures how much a value moves around relative to its long-term average. 14

15 Alignment delivered performing within defined parameters F&C MM Lifestyle Growth Fund F&C MM Lifestyle Balanced Fund F&C MM Lifestyle Cautious Fund F&C MM Lifestyle Defensive Fund F&C MM Lifestyle Foundation Fund N/A N/A N/A Apr 07 Apr 08 Apr 09 Apr 10 Apr 11 Apr 12 Apr 13 Apr 14 Apr 15 Apr 16 Apr 17 Source: Distribution Technology, F&C MM Lifestyle Foundation Fund was not launched until Discrete annual performance total return % F&C MM Lifestyle Funds 2016/ / / / /13 5 years F&C MM Lifestyle Growth Fund F&C MM Lifestyle Balanced Fund F&C MM Lifestyle Cautious Fund F&C MM Lifestyle Defensive Fund F&C MM Lifestyle Foundation Fund N/A N/A Moneyfacts Average Instant Access UK Retail Price Index Moneyfacts and UK Retail Price Index included for comparative purposes only. Unlike investments, instant investment accounts do not place capital at risk. 5 year numbers are cumulative. Source: Lipper, B Inc shares net of fees in sterling as at F&C MM Lifestyle Foundation Fund launched on so 2012/13 and 5 year numbers are unavailable. Past performance is not a guide to the future. The value of your investment can go down as well as up. As a result, its value in the future may be less than the amount you invested. Please note that we cannot give you any advice on the suitability of investing in our funds. Prospective investors should consult the Key Investor Information Document for the relevant share class before investing, which is available from your financial adviser or our website at bmogam.com. 15

16 Want to find out more? For more information on BMO Global Asset Management or our range of funds please contact your financial adviser BMO Global Asset Management. All rights reserved. BMO Global Asset Management is a trading name of F&C Fund Management Limited, which is authorised and regulated by the Financial Conduct Authority. CM15473 (01/18). UK