Liontrust Assessment of Value Report - Flipbook - Page 124
Liontrust MA Blended Reserve Fund
The Fund, which is managed by the Multi-Asset team, seeks to
achieve capital growth and income with a low level of volatility
(risk), having a risk profile of 2, 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 are 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 18.4% over the past five years.*
The Fund has seen positive returns across both equities and bonds. The strong
performance of US equities provided the biggest contribution while other
markets, including UK, Japan, Emerging Markets and Europe, were also positive
contributors. Although returns from bonds were not as significant, they continue
to meet four roles: providing some income, capital preservation, inflation
protection and diversification from equities.
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. This was offset,
however, by the issues faced by two holdings: aircraft leasing and catastrophe
reinsurance.
We still believe in the diversification benefits of these assets, but the former was
significantly impacted by a virtual halt to air travel during the pandemic while
the latter 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.
124 - Liontrust Assessment of Value Report