Investments pensions PROTECTION
ABOUT OLD MUTUAL WEALTH AND OLD MUTUAL Old Mutual Wealth Limited is a leading wealth management business in the UK and internationally. We provide platform-based investments including ISAs, bonds, pensions and life assurance, all underpinned by a choice of investments and ways to monitor and manage them online, with the help of your financial adviser. Our offering also includes asset management solutions and discretionary management. With 127.3 billion in assets under management (as at 30 June 2017), our aim is to help create prosperity for the generations of today and tomorrow. Introducing the WealthSelect Managed Portfolio Service 3 At a glance summary 3 What are managed portfolios? 4 How does the WealthSelect Managed Portfolio Service work? 6 What are the benefits of the WealthSelect Managed Portfolio Service? 7 Who is involved in the WealthSelect Managed Portfolio Service and what do they do? 8 Questions and answers for investors in the WealthSelect Managed Portfolio Service 9 2
INTRODUCING THE WEALTHSELECT MANAGED PORTFOLIO SERVICE The WealthSelect Managed Portfolio Service provides a practical and cost-effective way to manage your investments, keeping them on track with your aims and providing you with regular information on them. This guide explains what managed portfolios are, the benefit of this service, how your investment in your chosen portfolio will be managed, and what the alternatives are. WEALTHSELECT MANAGED PORTFOLIOS A WealthSelect Managed Portfolio contains a basket of funds representing a variety of assets classes: UK and global stocks and shares, property, fixed interest, and cash. Each portfolio contains different proportions of these assets, according to the balance of risk and reward that it is designed to achieve. Fixed interest Cash % Global stocks Property UK stocks The funds that are used in the portfolios are some of the best known in the market from leading fund management groups. The WealthSelect Managed Portfolio Service - at a glance Performance A range of actively managed portfolios exclusively available through your financial adviser. Each portfolio is designed to match a different investor risk profile and Old Mutual Wealth product wrapper. You and your adviser can choose the appropriate portfolio for your needs. Investment decisions and all buying and selling transactions within the portfolio are taken care of by us, as the portfolio manager (see page 8). Brand Portfolios are made up of funds from Global Partners (see page 5)*. Global Partners brings together some of the industry s leading fund managers and best known asset management brands across all the major asset classes. Service Quarterly portfolio reports keep you in touch with the performance of your investment. Unlike some similar services, there is no minimum investment level required. (There may be a minimum investment amount for the product wrapper you are investing in.) Price Each managed portfolio is made up of competitively priced funds. The ongoing management of the portfolios is provided at no extra cost**. * Our Managed Portfolios are made up exclusively from the funds from Global Partners. (See page 11) ** The only cost involved is VAT added to the Service Charge (formerly known as the Platform Charge) for ISAs and Collective Investment Accounts only. 3
WHAT ARE MANAGED PORTFOLIOS? Managed portfolios typically contain different mixtures of assets, chosen so that the performance of each portfolio matches a particular client risk profile. When you invest in a managed portfolio, investment experts make the decisions about the choice of funds to buy and sell and when to make changes to the asset mix. Your WealthSelect Managed Portfolio The Managed Portfolio recommended by your adviser holds a combination of carefully researched funds from Global Partners featuring some of the best known fund management names in the industry. Global Partners are 17 fund groups we have partnered with who are all high quality investment houses, offer a broad range of strategies and are home to some of the UK s best fund managers. The particular Managed Portfolio chosen for you will be the one judged by your financial adviser as most likely to deliver your objectives and stay within the investment risk level you agree with them. Matched to your risk profile WealthSelect Managed Portfolios are designed to match different Old Mutual Wealth risk profiles from 3 (low) to 10 (high) and are tailored for the specific investment product wrapper involved: ISA, Collective Retirement Account, Collective Investment Bond or Collective Investment Account. It s important to bear in mind that all investments involve some risk and that the value of your Managed Portfolio can go down as well as up. Having an understanding of the way your investments behave will help you feel comfortable about such variations. That s why the risk profiling discussion with your financial adviser is an important part of the investment process. You can find out more about risk profiling by reading the booklet: Understanding risk available from your financial adviser. Actively managed To achieve consistency with your investment goals, our portfolio managers constantly monitor the funds within your portfolio to make sure they are achieving their investment objectives. If any adjustments to the fund mix are needed, our portfolio managers will make them and issue regular updates. 4
Different asset combinations in the portfolios represent different levels of risk. These are for illustrative purposes only. The actual composition of the portfolios will vary. Collective Retirement Account Collective Retirement Account Collective Retirement Account risk level 3 risk level 5 risk level 7 CRA 3 CRA 5 CRA 7 Cash/money markets 27.25% Cash/money markets 18.00% Cash/money markets 11.75% Property 32.50% Property 21.76% Property 11.00% UK fixed interest 31.47% UK fixed interest 45.01% UK fixed interest 57.40% 12.73% UK Equity 17.35% UK Equity 6.28% UK Equity International Equity 2.50% International Equity 2.50% International Equity 2.50% GLOBAL PARTNERS features some of the best known names in the industry. 5
How does the wealthselect Managed portfolio service work? Assessing your needs Your financial adviser will guide you through an investment risk questionnaire and assessment process. You and your adviser will then agree the balance of risk and reward that best suits your needs and circumstances. Keeping in touch with your investments Your financial adviser will provide you with quarterly reports and valuations to keep you in touch with the performance of your investments and tell you about any changes that are made to the mix of funds within your portfolio. Managed portfolio service Choosing your portfolio Your adviser recommends the most appropriate WealthSelect Managed Portfolio for you, in line with your risk profile and the product wrapper in which you are investing. Benefiting from our expertise When you invest in one of our portfolios, you don t need to be involved in choosing and changing funds on a regular basis. Instead, you can benefit from the expertise of investment professionals, who constantly monitor the funds within the portfolio to make sure they are meeting their objectives and make any adjustments that may be necessary. 6
What are the benefits of the WealthSelect Managed Portfolio Service? Choosing and keeping an eye on how well your funds are performing - and making appropriate adjustments when required can be a complex, expensive and timeconsuming task. The Old Mutual Wealth Managed Portfolio Service provides a practical and reliable solution that aims to keep your investment charges low and your investments on track to achieve their aims, without you having to be involved in regular fund reviews. Other benefits include the following. Active management You can be reassured that your investment is being constantly monitored and actively managed by experts to help ensure it meets its objectives. High quality funds Global Partners, used to construct our Managed Portfolios, are continually monitored by our investment experts. See page 8 (overleaf) for information about their roles. Their selection is based on decades of experience working with all the major fund companies. Tax-efficient Your Managed Portfolio takes account of the product wrapper (pension, ISA etc) in which you are investing, allowing your financial adviser to optimise its tax-efficiency, where applicable. Please also see the question What about Tax? in your Key Features Document. Always informed Once you invest in a Managed Portfolio your financial adviser will provide you with high quality, quarterly reports that present your portfolio information clearly. You ll also find it easy to track the performance of your investments online, so you ll always know where you are with your investment. Value for money Because of the preferential rates we have negotiated with our Global Partners, we re able to give you these high quality, actively managed investment solutions at very competitive rates.* * Your personalised Key Features Illustration (right) gives details of the charges that apply to your investment, how they are taken and the effect they could have on the value of your Managed Portfolio. What you get back will depend on the performance of your portfolio and is not guaranteed. You may get back less than you put in. 7
WHO is involved in the wealthselect managed portfolio service And what do they do? There are a number of parties involved in bringing the Managed Portfolio Service to you. The financial industry regulations about investment permissions mean that, in the case of ISA and Collective Investment Accounts, the contract for the Managed Portfolio Service is between you and your adviser. In the case of the Collective Retirement Account and the Collective Investment Bond your contract is with Old Mutual Wealth. Your adviser will explain what this means to you. YOUR FINANCIAL ADVISER Discussing and agreeing with you a suitable Managed Portfolio. Giving Old Mutual Wealth instructions to set up your chosen portfolio. Providing you with regular reports on how your portfolio is performing. Carrying out due diligence on the Managed Portfolio Service to ensure it continues to meet your needs. Old Mutual Wealth Investment Division Comprised of Old Mutual Global Investors and Quilter Cheviot. Providing most of the funds offered within the range. Managing and running some of the WealthSelect funds. Managing the portfolios on behalf of Old Mutual Wealth. This covers asset allocation, manager selection and portfolio construction. Researching and continually monitoring the managers within the range. Old Mutual Wealth Provides the Managed Portfolio Service. Governs and oversees the running and management of the Managed Portfolio Service. Develops WealthSelect over time to ensure it continues to meet any changing customer needs. GLOBAL PARTNERS External fund managers we have hand-picked to work with. Using a rigorous research process, we distilled the thousands of available funds into Global Partners: a focused range of high quality managers that we believe can deliver superior investment performance for investors. THE Old Mutual Wealth INVESTMENT OVERSIGHT COUNCIL The Managed Portfolio Service is overseen by the Old Mutual Wealth Investment Oversight Council which comprises a member of the Old Mutual Wealth Executive Management team, Old Mutual Wealth s Head of Product, and two independent external advisers. They advise and make recommendations in respect of the following: the investment solutions are performing as intended the investment decision making processes are robust appropriate risk management is in place any conflicts of interest are managed 8
Questions and answers for Investors in the Wealthselect managed portfolio service 1. Is the WealthSelect Managed Portfolio Service right for me? Your financial adviser has recommended a suitable Managed Portfolio because in their judgement, it best reflects your investment objectives, your personal circumstances, and your attitude to risk, as reflected by your risk profile. The discussion you have with your adviser about this is key to making sure they identify the right Managed Portfolio for your needs. As well as establishing your attitude to risk, you and your adviser will need to consider a number of factors including the following. Cost How cost-sensitive are you? The funds in the WealthSelect Managed Portfolios typically have lower annual management charges than those available from our SelfSelect range (see page 11). Investment knowledge and experience To what extent do you want to be involved in portfolio building and management? With the Managed Portfolio Service all investment decisions are made by the portfolio managers. The Service is not suitable if you want to make your own decisions about the contents of your portfolio. Breadth of choice Are you happy with the selection of high quality funds used to construct the WealthSelect Managed Portfolios or do you want the flexibility and wider choice available through our SelfSelect range? (See page 10). Reporting How frequently do you need to review your investments and how much detail do you require? Regular reporting is provided as part of the Managed Portfolio Service. 2. how will I know how my Managed Portfolio is performing? Every quarter you will receive a Portfolio Report and Valuation, direct from your financial adviser. In addition to an up-to-date valuation, you will get a full break-down of how your portfolio is invested and details of any significant changes made to your portfolio during the previous quarter. Your adviser can also provide you with a valuation update at any time between quarterly reports. 3. can I change to another Managed Portfolio? Yes. If your investment goals change, you and your adviser may decide that another Managed Portfolio is more suitable. Your adviser will run through the risk profiling process again to see whether a change is appropriate, then make their recommendation. Old Mutual Wealth will make no charge for changing your portfolio. Depending on the contract you have agreed with your financial adviser, they may charge a fee for their advice about this. 4. can I make a change to the funds in my Managed Portfolio? Because the portfolios are actively managed on a discretionary basis, the balance of funds within them can only be adjusted, and the funds themselves changed, by the portfolio manager. If you or your financial adviser want to make a change you can do so, but it will automatically mean that the Managed Portfolio Service will stop and any future changes to the funds in your portfolio ( fund switches ) will be for you to decide. You and your adviser can create your own portfolio of funds from Global Partners or our alternative SelfSelect fund range (see page 10). Old Mutual Wealth does not make a charge when you switch funds. If you have agreed a fund switching fee with your adviser, you can ask us to pay it on your behalf from your investment. 5. can I change my mind once I have invested in a Managed Portfolio? If you invest in a Managed Portfolio and later wish to opt out you can do so easily, without charge and without having to sell any of the underlying funds. This enables you to take back control of your portfolio if you need to and manage the timing of any further changes you wish to make. 9
WHO is involved in the wealthselect managed portfolio service And what do they do? cont. 6. What if I want to invest in a wider range of funds? The WealthSelect Managed Portfolio Service is designed to cover most investment goals and attitudes to risk. However, it may be that you and your adviser want to explore a wider range of funds. If so, you and your adviser can build your own individual portfolio rather than use one of the Managed Portfolios. To do so, you can choose funds from either of the two fund ranges available from Old Mutual Wealth: WealthSelect or SelfSelect. See the table below: Please bear in mind that all the funds within any particular investment product pension, ISA, bond or account must be from the same fund range. In other words it s not possible to mix funds from both ranges within the same product. Your adviser will be able to explain the pros and cons of moving from one fund range to another, including the differences in cost. 7. What if I have a complaint about the Managed Portfolio Service? If your portfolio is for an ISA or a Collective Investment Account, your contract for the Managed Portfolio Service is directly with your financial adviser and they have the responsibility for dealing with any complaints you may have. If your portfolio is for a Collective Retirement Account or a Collective Investment Bond, your contract for the service is directly with Old Mutual Wealth Life & Pensions Limited, and you should therefore direct any complaints to Old Mutual Wealth Life & Pensions Limited, Head Office, Old Mutual House, Portland Terrace, Southampton, SO14 7AY. As a customer of Old Mutual Wealth, your rights to regulatory protection under Financial Conduct Authority (FCA) rules, and to any compensation under the Financial Services Compensation Scheme, are detailed in the Key Features Document for the product in which you are investing. Those rights are not affected by the Managed Portfolio Service. GLOBAL PARTNERS Hand-picked range You can build your own portfolio by choosing from this range of around 60 researched funds, hand-picked from some of the UK s best-known investment houses. Specially negotiated pricing Global Partners funds are competitively priced because of the special terms we have negotiated with the fund managers involved. SelfSelect investment range Wider range Our SelfSelect fund range offers more than 1,300 investment funds from a market-wide range of fund groups and managers, giving you and your adviser the flexibility to build a fully bespoke portfolio. Market pricing Typically the charges for SelfSelect funds are higher than Global Partners funds, but we have still used our buying power to secure discounts below the market rate for many of the funds within the SelfSelect range. 10
More information This brochure gives you an overview of the WealthSelect Managed Portfolio Service and the benefits for investors. Your adviser will also give you: the Key Features Document that explains more about the Old Mutual Wealth product in which you are invested (e.g. ISA, Collective Retirement Account etc). 11
Your investment may fall or rise in value and you may not get back what you put in. www.oldmutualwealth.co.uk Please be aware that calls and electronic communications may be recorded for monitoring, regulatory and training purposes and records are available for at least five years. Old Mutual Wealth is the trading name of Old Mutual Wealth Limited which provides an Individual Savings Account (ISA) and Collective Investment Account (CIA) and Old Mutual Wealth Life & Pensions Limited which provides a Collective Retirement Account (CRA) and Collective Investment Bond (CIB). Old Mutual Wealth Limited and Old Mutual Wealth Life & Pensions Limited are registered in England and Wales under numbers 1680071 and 4163431 respectively. Registered Office at Old Mutual House, Portland Terrace, Southampton SO14 7EJ, United Kingdom. Old Mutual Wealth Limited is authorised and regulated by the Financial Conduct Authority. Old Mutual Wealth Life & Pensions Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Their Financial Services register numbers are 165359 and 207977 respectively. VAT number 386 1301 59. SK14297/218-0217/March 2018