MULTI-MANAGER funds are designed to make life easier for savers by packaging together teams of specialist investment managers into a single fund. This gives the investor exposure to a spread of bright minds and styles that would be difficult – if not impossible – to replicate in any other way, together with the expert oversight of the multi-manager firm itself.
In a sense, such an investment is a one-stop savings shop. The downside is that management fees tend to be higher than other funds.
The Jupiter Merlin range is favoured by Alistair Blyth of Edinburgh-based AB1 Financial Planning. He says
: "The overall returns from these funds has (in general] justified the higher than average annual management charges."
AB1 also likes Cazenove Multi-Manager Diversity fund for its consistently good performance within the "cautious managed" sector. It has risen 34.5 per cent in three years in comparison with 28.32 per cent for the sector, according to TrustNet research. It has attracted more than £110 million.
Capital Financial Managers' Arch Cru fund is also tipped by Blyth. This £30.5m multi-asset portfolio aims to provide an absolute return of 3-4 per cent above cash after deduction of all fees. It achieved 3.8 per cent in the year to date and 36.3 per cent growth over three years.
Consider multi-manager funds that invest in equities or property where the total costs are not too high, but avoid ones in fixed interest, warns Wishart Wealth Management. Wish-art says that the difference between the best and worst performing fixed interest funds tends to be slight and paying the extra charges for a multi-manager is unlikely to gain any extra return.
If your home is your only exposure to property, consider a multi-manager fund. Do not be put off by the current downturn. Back in 1974, Nationwide says, the average home cost £10,077. Today it is £178,855.
Margetts-Greystone Property could be a wise pick as the fund manager can move between different types and styles of property funds whereas an individual investor will not usually have the time and experience to do this for themselves, according to Wishart Wealth.
If lightweight in some key geographical areas but wary over backing a single fund, then a multi-manager makes good sense. With so many eyes on China – not just for the Olympics but her thrusting economy – consider New Star's Asia Portfolio which excludes lack-lustre Japan.
Managed by Rob Jeffree, this £27.6m fund has jumped 81.4 per cent in three years.
Similarly, if unsure which emerging market to back from Brazil to Venezuela, look at a proven success story such as Credit Suisse's Emerging Markets Portfolio which is up 77 per cent in three years.
The full article contains 472 words and appears in The Scotsman newspaper.
