Multi-Asset Range

The investment process for the funds managed by the Multi-Asset Group is illustrated in the diagram below:
 

While each fund has a distinct performance target, the investment process is the same (with the exception of the UK Dynamic Managed Fund described below). The funds can invest in an equally broad range of asset classes, regions and strategies (subject to differing maximum limits for each asset class).

The level of the performance target dictates each fund’s risk budget and how it is allocated. For example, the DDR Fund, which has the highest target, is likely to have a higher proportion of riskier assets, such as equities, in order to achieve its goal. The DHI Fund, whose primary aim is to generate income, will be biased towards income generating asset classes, such as equities, fixed income and property.

The funds’ diverse, multi-asset approach allows for the creation of portfolios of largely non-correlated assets, which serves to mitigate downside risk. Active management of this broad range of asset classes can then further improve risk adjusted returns. This tactical asset allocation is undertaken to benefit from the best global investment opportunities at any given time, while equal emphasis is placed on risk analysis.

The Multi-Asset Group identifies long-term strategic themes that are likely to result in the outperformance of particular assets, be the regional equity or property markets, currencies or commodities, etc. These ideas are generated from a variety of sources. The Multi-Asset Group places great emphasis on internal research and idea generation. This is supplemented by information that comes to light from discussions with external fund managers during the rigorous manager selection process. There is also continual contact with sell-side analysts, which often unearths potential investment opportunities or new themes. As a valued and long-term investor, the Insight’s Multi-Asset Group has built up strong relationships with investment professionals across the market, facilitating this flow of information.

Meanwhile, the team undertakes a rigorous selection process to identify the optimum investment opportunities from the universe of around 5,000 eligible funds. This process begins with initial screening through to fund manager interviews and further in-depth analysis. As a result, approximately 10 fund manager meetings are undertaken per week.

Beyond this extensive universe of pooled funds, Insight’s Multi-Asset Group seeks to make use of other investment opportunities by investing in tailor-made structured notes and other derivative instruments. These notes may be purchased in order to benefit from market inefficiencies or arbitrage opportunities, and can be a good low-risk method of supplementing a fund’s returns. They are generally sourced from investment banks or other counterparties, with extensive research undertaken to find the best terms for each instrument.

UK Dynamic Managed Fund

The UK Dynamic Managed Fund is managed slightly differently from the other funds within the group in that it is constructed wholly on a multi-manager basis, i.e. no direct investment in any asset class or instrument.

As with the other funds, the multi-asset group undertakes a rigorous selection process to identify the optimum investment opportunities from the universe of thousands of eligible funds. This process begins with initial screening through to fund manager interviews and further in-depth analysis. As a result, approximately 10 fund manager meetings are undertaken per week.