Gill Hutchison, investment research manager at Old Broad Street Research, takes a look at the firm's multi-manager category 'active asset allocation, absolute return bias'. Multi-managers working to this mindset can produce great results over the long term, but many can struggle over a shorter time period
First things first - what is meant by the term 'absolute return mindset'? There are not too many multi-managers operating in this space - maybe because it is a tricky place to be, given its rather nebulous position somewhere between traditional retail funds and absolute return funds. In our view, multi-managers in this category can be described as those who are more interested in generating positive returns for their clients than they are in pursuing superior returns relative to a benchmark or peer group. They acknowledge that investors do not relish losing money even if an investment has ...
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