Liontrust Assessment of Value Report - Flipbook - Page 116
Liontrust MA Blended Growth Fund
The Fund, which is managed by the Multi-Asset team, seeks to
achieve capital growth and income with a moderately high level
of volatility (risk), having a risk profile of 6, in a range from 1 to 7
where 1 is the lowest risk and 7 the highest. The underlying funds
will be a blend of active funds, whose managers aim to beat the
performance of a benchmark, and passive funds, which aim to
track the performance of an index. Active funds will be selected
over passive funds where the investment managers believe the
potential returns from active funds outweigh any additional cost.
Performance
Overall value
assessment
We have evaluated the
Fund against all seven
criteria in our assessment
of the value it provides to
investors. While the Fund
has received an Amber for
comparable market rates,
we have concluded that
the Fund has performed
in line with expectations
for the remaining criteria,
delivering overall value to
investors including through
the investment performance.
Go back to the Summary
of the Assessment of
Value table
We have assessed the investment performance of the Fund against its stated
investment objective that is set out in its prospectus. We considered whether the
Fund has performed how we and investors would expect it to, given the market
conditions it has been operating under, and its investment philosophy, strategy
and process.
The Fund’s objective is to target a specific level of long-term volatility (15 years)
while trying to maximise the total return to the investor which may be in the form
of either income or capital growth.
We have reviewed the positioning of the portfolio and the expected future
volatility of the portfolio over the last year and can confirm that the Fund stayed
within its targeted risk band and is on track to meet the expected level of
volatility over the long term.
The Fund has delivered a return of 50.4% over the past five years.*
The investment team sought to maximise returns while ensuring the Fund stayed
within its targeted risk band and the expected level of volatility.
The Fund has seen positive returns across all equity markets. The strong
performance of US equities provided the biggest contribution while other
markets, including UK, Japan, Emerging Markets and Europe, were also positive
contributors. Overall, the Fund benefited from a higher allocation to equities,
including significant exposure to US equities, compared to those Multi-Asset
Blended funds at the lower end of the risk scale.
The Fund’s small exposure to UK property acted as a drag on performance
although this was offset by the positive performance of convertibles, the only
bond exposure in this Fund. A convertible bond is a corporate debt instrument
that pays regular income and returns capital at the end of a fixed term.
Convertibles also enable investors to convert them into shares and allows
holders to benefit from rises in share prices while retaining a degree of bondlike mitigation against market falls.
The small allocation to alternative assets were broadly flat over the period as
their more defensive nature means they are less likely to benefit from a rising
market. Most of the holdings in this asset class did perform relatively well and
provided positive returns, including renewable energy, infrastructure and gold.
However, this was offset by the issues faced by catastrophe reinsurance. We
still believe in the diversification benefits of this asset class, but it has struggled
in the face of extreme weather conditions.
This document is intended to be for information purposes only. It is not
marketing material.
*Source: Financial Express, as at 31.08.21, total return.
116 - Liontrust Assessment of Value Report