Research by Architas shows that the vast majority of advisers are set to increase their exposure to multi-asset funds during the rest of 2013. More than three quarters (83%) of the advisers asked said they were either likely or very likely to increase multi-asset exposure this year.* The most popular reasons for choosing multi-asset solutions were the diversification (36%) and risk profiling opportunities (27%) they offer.
Cedric Bucher, head of business development, Architas, said: “It is understandable given the recent volatility of the markets that advisers are keen to ensure their client holdings are well diversified. Multi-asset funds can play a role in helping advisers to meet this objective. Although the best performing single asset portfolio will always outperform a diversified portfolio in the short-term, in the long run the weighted average of different asset classes can be very attractive. A diversified portfolio is also likely to enjoy much lower volatility than a fund invested solely in one asset class.
“There is also a move away from a stock picking approach by advisers. This is being driven in part by regulatory pressures, as a result of the RDR, and the increased emphasis on client suitability. Risk profiled solutions, with regular and automatic rebalancing, can reassure advisers that investments will remain appropriate.
“Industry figures show the growth of multi-asset fund solutions. This research suggests that trend is set to continue.”
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