Managed Portfolios

Managed Portfolio Service

Our Managed Portfolio Service is our flagship investment proposition; launched in 2012 the portfolios have an enviable track record of which we are proud. Today we manage over £100 million in client assets through these portfolios.

We post regular updates on our active portfolios and these can be accessed by clicking on the relevant portfolio below.

Low Risk Factsheet

Lowest Medium Factsheet

Low Medium Factsheet

High Medium Factsheet

Highest Medium Factsheet

Why were the portfolios created?

The service was set up to address a key challenge which many advisory forms still struggle with today, namely how to deliver a consistent investment process to our clients whilst at the same time being able to tailor the risk/return characteristics of recommendations to their individual needs.

The service consists of a series of risk-targeted portfolios which blend together a mix of different asset classes (UK and Overseas Equities, Bonds, Property, Alternatives and Cash) and funds from a wide range of fund managers. The portfolios are made up mainly of actively managed funds but where it makes sense to do so, index funds may also employed. Each portfolio has defined target risk characteristics and is benchmarked against a suitable investment sector.

 

How do you operate the portfolios?

The portfolios are constructed with the assistance of a third-party actuarial model which aims to establish the optimum blend of assets for a given risk profile by running simulations based on assumed future rates of investment return. These models are then populated with funds using in-house research which initially screens based on fund size and manager tenure and then takes into account a number of both quantitative risk and performance metrices and qualitive analysis by third party firms such as Morningstar and RSM.

Portfolios are reviewed on a quarterly basis from an asset allocation, and investment funds point of view. We will actively swap out under performing funds and seek to identify those funds which in our view offer the best prospects for future returns. As part of the quarterly review each portfolio is also measured from a risk/return point of view against the model and benchmark to ensure they continue to meet their objectives.

Following each quarterly review, all of our clients who invest in the service receive an email advising them of any changes that we recommend. As this is a wholly advisory service, clients must reply to ensure the changes are implemented. Each quarter, regardless of whether any other changes are to be made, we recommend clients rebalance their portfolios back to the model asset/fund allocation. This process ensures the portfolio’s risk and return characteristics don’t drift over time as a result of investment performance issues.

 

How will they typically be invested?

Each of the portfolios consists of a blend of asset classes including cash, bonds, property and equities and the blend of these assets is determined by where it sits on the risk scale. The higher the risk, the more the exposure to equities and the lower the risk the greater the exposure to cash and bonds. A breakdown of each portfolio is shown in the factsheet:

What else do I need to know?

The aim of the portfolios is to bring together some of the very best investment funds to deliver superior returns for our clients in the long term. Because we offer a range of portfolios, they are suitable for clients with a wide range of risk appetite and should that change over time, it is a simple process to switch between them.

It is important to note that these are “fully invested” portfolios that are designed to sit at a particular point on the risk scale. They are very likely to remain fully invested at all times. This means that whilst quarterly reviews of the portfolios will take place, it is highly unlikely that we will make significant changes to the asset mix of the portfolios and are very unlikely indeed to raise cash levels with the portfolios to anything other than a very modest level even in times of market turmoil/distress. Clients who wish to reduce their level of market exposure can do so either by partially or wholly exiting a portfolio or by switching from one portfolio to another.

The Managed Portfolio Service can be used through a wide range of investment wrappers and including SIPPs and SSAS, ISAs and unwrapped investment accounts and via a wide range of investment platforms. It is also important to note that switches and rebalances rely on our ability to execute trades through the relevant product/platform and it is not always possible to implement instructions immediately.

It is worth noting that it is the overall portfolio that we seek to match to an investors risk profile and that a portfolio may hold funds which in isolation might be viewed as either higher or lower risk than an individuals risk profile may suggest as suitable. In addition, whilst we strive to include the best performing funds in our portfolios, we don’t get every fund pick right, which is why it is important to view the portfolio and its performance as a whole.

The fact sheets, which can be accessed through the links above, show information about each portfolio including how they are invested and their performance. It is important to note that this information relates to the core portfolio and assumes all switch and rebalance recommendations are accepted and implemented each quarter on the specified date. This may not always be possible if there are existing transactions waiting to be processed – for example, withdrawals, transfers, re-registrations and encashments for fees or income. The performance data for the portfolio and any benchmark used do not take into account product or advisory fees and the actual returns clients will see may differ from those shown. Additional fact sheets covering specific time periods and for the index portfolios are available if you contact your adviser or the client support team.

Please note, past performance and risk data is not a guide to the future and the value of investments can go down as well as up. An investor may not get back the sum originally invested even if they invest for the long term.

Further information on the portfolios can be found in our guide which is available below.

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Call one of the Hammond Raggett and Company team on 0161 834 2222 to discuss how we can help you, or press the button below to be directed to our contact form.

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