Credit Suisse plans to scrap its regional multi-manager funds and launch a Multi Asset Distribution fund in a shake-up of its multi-manager range.
The Credit Suisse Multi-Manager European, Japanese and North American funds will merge into the Multi-Manager International fund while Multi-Manager Asia Pacific will become part of Multi-Manager Emerging Markets.
The group says the selective consolidation of regional funds into global portfolios will focus the team’s expertise on delivering the strongest growth and investment opportunities for investors.
However, the move could be a blow for IFAs who were happy to let the multi-manager team select individual funds but wanted to make regional and asset allocation calls themselves.
Aidan Kearney, co-head of the Credit Suisse Multi-Manager team, comments: “We believe strong risk-adjusted returns can be achieved better through focused international funds, as opposed to a series of regional funds. We can be more nimble with portfolio changes and it ensures that our time is more targeted on the search for alpha.
“Anecdotally, a large proportion of the IFA market would rather leave regional and asset allocation calls to fund managers, making a single global fund more appealing both from an investment and a personal tax perspective, as switching between funds within a multi-manager portfolio doesn’t trigger any direct tax implications for the individual.”
Meanwhile, the Multi-Manager Global Bond fund will be relaunched as the Multi-Asset Distribution fund to meet investors’ desire for regular income as well as potential capital growth.
The fund’s investment universe will be broadened to include a much wider range of asset classes, such as property and hedge funds. Under current market conditions, the fund will have an indicative yield of more than 5% (per annum gross) but this will vary as conditions change.
The proposed Credit Suisse Multi-Manager Multi Asset Distribution fund asset allocation will be:
- Fixed interest – 20-40%
- Protected Equity – 20-30%
- UK Equity Income – 10-30%
- Overseas Equity – 0-20%
- Property – 5-15%
- Alternatives – 5-15%
- Cash 0-10%
Graham Duce, co-head of the Credit Suisse Multi-Manager team, has been running a multi-asset income product for private clients at Credit Suisse prior to his new role in the asset management division.
He says: “After thoroughly reviewing our fund range, we saw opportunities to make real improvements for investors and truly make the funds our own. This represents the next step in the development of the Credit Suisse range and is also a response to changing markets and evolving investor appetite.
“The proposed Multi Asset Distribution fund gives investors access to additional investment strengths, extra diversification and asset allocation expertise. It sees us entering a market early, with a compelling, competitive product and a very experienced team to support it.”
Shareholders will be asked to vote on all these changes at a meeting on 10 August.
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