There is an increasing recognition that outcomes matter more to investors than performance versus a particular index or benchmark. Clients are seeking predictability and consistency in an uncertain world and want their money managed in line with long-term goals. This might be meeting liabilities, boosting returns in a low yield environment, or controlling volatility. Multi-asset can play a key role here.
We can potentially improve returns and/or reduce risk by diversifying across asset classes. However, we believe a considered and broad-ranging combination of investments is required today, including innovative sources of return such as commodities, infrastructure or alternative risk premia such as momentum, value and carry. A portfolio with true risk diversification has a better chance of surviving difficult markets.
Actively allocating between, and within, different asset classes potentially can add significant value to portfolios over time. This is especially true in today’s lower return environment, which is expected to persist for the foreseeable future. However, it takes time and resources.
Multi-asset can therefore also help address the increasing regulatory pressures and governance requirements that institutions face when managing their own portfolios.
Our multi-asset approach focuses on the management of risk, in particular limiting large reductions in your capital. In this way we seek to help you to “win by not losing”. We’ve been doing this successfully for over 70 years.
Our multi-asset team has over 100 people based on-the-ground throughout the US, Europe and Asia Pacific. Being located alongside you gives us a better understanding of your specific requirements.
We offer a variety of ways to meet your needs. Firstly, we have products that aim to deliver cash-plus or inflation-plus returns. Secondly, there are solutions that focus on delivering a diverse and sustainable income stream. Finally, we have more traditional strategies that aim to outperform blended market benchmarks. We may use both active and passive strategies within portfolios, maintaining a focus on delivering the best possible value for money.
If you are a larger institution with strict investment guidelines to adhere to, we also have the ability to construct bespoke solutions that meet your individual requirements, or engage in strategic partnerships – we pride ourselves on our transparency and willingness to help.
Past performance is not a guide to future performance and may not be repeated.
The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of any overseas investments to rise or fall.
Alternatives can be more volatile than shares and bonds, and it may be harder to cash in the investment at short notice.
The views and opinions contained herein are those of the authors, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This webpage is intended to be for information purposes only. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. No responsibility can be accepted for errors of fact or opinion. Reliance should not be placed on the views and information in the webpage when taking individual investment and/or strategic decisions. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. The data contained in this webpage has been obtained from sources we consider to be reliable. No responsibility can be accepted for errors of fact and the data should be independently verified before further publication or use. The sectors shown are for illustrative purposes only and not to be considered a recommendation to buy or sell. Exchange rate changes may cause the value of any overseas investments to rise or fall. All investments, domestic and foreign, involve risks including the risk of possible loss of principal. Investing in equities involves risk considerations, including market risk, prospects of stocks in the portfolio, changing interest rates, and real or perceived adverse competitive industry conditions. Investing in bonds may include interest rate, credit, inflation/deflation risk, mortgage and asset-backed securities, U.S. Government securities, and liquidity risks, to varying degrees. Investing overseas involves special risks including among others, risk related to political or economic instability, foreign currency (such as exchange, valuation, and fluctuation) risk, market entry or exit restrictions, illiquidity and taxation. These risks exist to a greater extent in emerging markets than in developed markets. The use of derivatives involves risks different from, or possibly greater than, the risks associated with investing directly in the underlying assets. Private assets are intended only for qualified and/or sophisticated investors and carry special risk considerations, including illiquidity risk, wide differences in valuations, the use of leverage, and higher credit risk than traditional assets. Asset allocation and diversification cannot ensure a profit or protect against loss of principal. No investment strategy, capability or technique can guarantee it will achieve its stated objective. In North America, this content is issued by Schroder Investment Management North America Inc., an indirect wholly owned subsidiary of Schroders plc providing asset management products and services as a US SEC registered investment adviser and in the capacity of Portfolio Manager with the securities regulatory authorities in Canada. For all other users, this content is issued by Schroder Investment Management Limited, 1 London Wall Place, London EC2Y 5AU. Registered No. 1893220 England. Authorized and regulated by the Financial Conduct Authority.
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