Revealed: The multi-asset shortlists for the 2020 PA Awards

We are proud to say that, once again, so many great financial advice and provider firms put themselves forward and entered these awards, which are celebrating their 15th year. These awards seek to award excellence both within the financial adviser profession and the broader financial services sector that provides them with the products to best serve their clients. 

Below are the final shortlists for our awards that will take place on 6 February 2020. The other shortlists can be found online here.

Professional Adviser's thanks go to Paul Ilott, managing director of Scopic Research, for putting these shortlists together.

Best Multi-Asset Fund: Rising Income

Architas Diversified Real Assets

Fidelity Multi-Asset Income & Growth

MI Hawksmoor Distribution

Best Multi-Asset Fund: High Income

Close Diversified Income Portfolio

Fidelity Multi-Asset Balanced Income

Kames - Diversified Monthly Income

Best Multi-Asset Fund: Long-term Growth

Fidelity Multi-Asset Open Strategic

Jupiter Merlin Conservative Portfolio

Liontrust Sustainable Future Cautious Managed

Liontrust Sustainable Future Defensive Managed

Royal London Sustainable Diversified Trust

Sarain GlobalSar - Strategic

Best Multi-Asset Fund: Positive Return

Premier Multi-Asset Absolute Return

SVS Church House Tenax Absolute Return Strategies

Smith & Williamson Defensive Growth

Best Multi-Asset Fund Range: Volatility Managed

Architas Multi-Asset Active Funds

ASI MyFolio Multi Manager Funds

Legal & General Multi-Index Funds

Premier Liberation Funds

All of the shortlists, bar Multi-Asset Group of the Year and Adviser Firm of the Year, have now been revealed ahead of the awards on 6 February 2020. To see the rest of the shortlists for adviser, platform categories and others, or for more information about the awards shortlists or the evening itself, click here.

The methodology to select the shortlists for the multi-asset categories can be found below.

The multi-asset categories are based upon investment outcomes and each one may contain funds from a number of different IA sectors. Delivering the investment outcome and meeting the fund's own objectives in the most risk efficient manner is the key.

Rising Income

These funds must exhibit strong commitment to delivering a progressively rising stream of income - generally starting at around 3% per annum net in today's market. Distributions are typically delivered on a quarterly or more frequent basis. Having 'income' in the fund title or income simply being a by-product of the investment process is not sufficient.

High Income

These funds must exhibit strong commitment to delivering a sustainably high level of income - generally around 3% per annum net or higher in today's market. Distributions are typically delivered on a quarterly, or more frequent basis. Having 'income' in the fund title or income simply being a by-product of the investment process is not sufficient.

Long Term Growth

These funds are typically managed to long term investment horizons and are focused on capital growth rather than on income generation. Achieving good risk adjusted returns in both rising and falling equity market conditions regardless of the fund's sector is key to being included.

Positive Return

These funds seek to generate positive returns and typically aim to match or beat returns from a benchmark that also has a positive return profile. The timeframe to achieve the benchmark 'target return' is generally longer than for an 'Absolute Return' type fund - typically 3 years.

Volatility Managed

These are suites of funds managed by a single fund group where the expectation is that long term returns will be delivered within specified volatility parameters or below a specified volatility ceiling. Typically, each fund in the suite is distinguished by having a different tolerance to volatility. These are suites of funds rather than a single fund and simply being 'risk-rated' is not sufficient.

Quantitative Methodology

Minimum fund assets >= £25 million (approx.)

Must invest in multiple asset classes - defined as ‘Mixed Asset' by FE. (Equity, Bond, Hedge, Money Market and Structured Product classes are therefore excluded from all award categories).

Performance histories must (in most cases) span at least 5 risk-on market conditions and 5 risk-off market conditions as defined by a 10% increase or 10% fall (both approximately) in broader equity markets up until 31-Oct-2019. (An exception was made for the ‘Rising Income' category where fewer funds would otherwise have passed the quantitative scoring filter - here, funds that span 4 risk-on market conditions and 5 risk-off market conditions were also included.)

Peer group analysis is conducted within each individual risk-on, risk-off market period using; cumulative return, maximum gain, maximum drawdown, downside volatility and a risk-reward ratio metric. An average percentile risk score across all of the periods is then calibrated. Similar analysis is then carried out from the date of each inflection point in equity markets up until 31-Oct-2019 to arrive at an average long-term percentile risk score. A 50% weight is then given to the two percentile risk scores to generate an ‘overall percentile risk score'. Funds must have average ‘short term' risk percentile scores of 20^th percentile or less across the individual risk-on and risk-off periods as well as having an average long-term risk score of 20^th percentile or less using the equity market inflection point analysis. Funds that exhibit the most attractive overall percentile risk scores are then highlighted. 

When producing the analysis for the ‘Rising Income' and ‘High Income' categories, funds exhibiting an average historic yield of less than 3% over the past 4 years were excluded.

When producing the analysis for the ‘Long Term Growth' category, all mixed asset class sectors were covered, but income funds and volatility managed funds were excluded.

When producing the analysis for the ‘Positive Return' category, funds that follow income strategies were excluded.

When producing the analysis for the ‘Volatility Managed' category, funds were categorised according to their volatility parameters and scores awarded using the risk-on, risk-off analysis described earlier. An average score was then calculated for each volatility manged suite. Further analysis was then conducted on risk reward patterns and volatility trendlines.  

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