Global Multi-Asset Income Strategy
A balanced income across asset classes and regions
To provide an income, with some capital growth, while aiming for lower volatility than global equities, over rolling five-year periods.
An income that relies on one asset class is exposed to that asset class's bad years. Equity dividends were cut sharply in 2020. Bond yields were close to zero for most of the decade before 2022. A portfolio that draws on several sources can keep paying while one of them struggles.
We combine our own equity and credit research with a clear view on how much of each to hold. An asset allocation committee, chaired by Eleanor Whitcombe, sets the ranges each quarter. Tomás Herrera runs the portfolio day to day, with Sophie Lindqvist responsible for the bond holdings.
The strategy launched in February 2021. It is available to eligible investors through a pooled fund that deals weekly, and as a segregated mandate.
How we invest
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Income from many sources
Dividends from global shares, coupons from gilts and corporate bonds, and distributions from listed infrastructure and property. No single source is allowed to dominate the income.
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Allocation within set ranges
Equities 30% to 60%, bonds 25% to 55%, infrastructure and property 5% to 20%, cash up to 10%. The committee moves within those ranges when valuations change, not in response to headlines.
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Direct holdings, not funds of funds
We buy shares and bonds ourselves rather than other managers' funds. That keeps costs down and means we can show you every holding and every vote.
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Sterling at the centre
At least 80% of overseas currency exposure is hedged back to sterling, so the income you receive is not swamped by exchange-rate moves.
Key risks
The strategy carries the risks of every asset class it holds: shares can fall, bond issuers can default, and the prices of bonds and property shares fall when interest rates rise. Capital is at risk and you may get back less than you invest.
Holding several asset classes is no assurance that they will behave differently. In 2022 shares and bonds fell together, and a balanced portfolio offered less protection than usual. That can happen again.
The income is not fixed. It depends on the dividends and coupons the underlying holdings pay, and it will vary from quarter to quarter. We use currency forwards to hedge overseas exposure. These contracts protect against most exchange-rate moves but not all, and they carry a small risk that the bank on the other side fails to pay.
Questions investors ask
Why does the fund deal weekly rather than daily?
Some of our infrastructure and property holdings trade less often. Weekly dealing lets us meet subscriptions and redemptions without forcing trades in those shares, which protects investors who stay in the fund.
Is the income the same every quarter?
No. It reflects what the holdings pay. We publish the income paid in each of the last four quarters on the factsheet so you can see how much it varies.
How does this differ from holding your other strategies side by side?
It draws on the same research, but it adds global shares, gilts and real assets that our other strategies do not hold, and it changes the balance between them as conditions change.
Plan an income from one portfolio
Wealth managers and charities use this strategy to fund regular payments without building and rebalancing a portfolio of funds. Tell us the income you need to fund and how often, and Tomás Herrera will explain how the strategy could fit.
Contact us