Routine way of blending multi asset funds keeps biases impacting returns

Managing director Paul Ilott pointed to how combining multi asset funds that have passed through a simple performance filter has, in recent years, often led to blending multi asset funds where "returns are still driven by the same embedded biases". Ilott said these most commonly include growth style and quality style factors, larger companies - particularly in the US, and ESG-risk characteristics. "Combining multi asset funds that share the same embedded biases (DNA) - irrespective of whether they invest directly in securities, in passives, in actively managed single strategy funds, o...