Managed by Aymeric Forest and Iain Cunningham, the fund has seen significant inflows in Europe (most notably Italy, Germany and France), Asia and the Middle East, as clients seek a sustainable and diversified stream of income for a moderate level of risk[4].
The investment style is unconstrained and global, allowing investors to take advantage of yield opportunities in whichever region or asset class they arise. The fund invests directly in a range of liquid asset classes such as equities, investment grade bonds, infrastructure and emerging market debt, with a maximum of 10% in liquid, listed alternatives.
Aymeric Forest, Head of Multi Asset Investments Europe and Fund Manager of Schroder ISF Global Multi-Asset Income, Schroders, commented:
“In this moderate growth environment yields are expected to remain low. As a result, some investors are taking more risk in their search for income. Our investment philosophy focuses on delivering a sustainable and diversified stream of income for a moderate level of risk. This is achieved through our global, benchmark unconstrained, and flexible investment approach.
“Equities are our preferred asset class, though careful risk management is required in periods of heightened volatility. We have a preference for those equity markets that should continue to benefit from loose monetary policy (Europe and Japan), while we continue to tilt the portfolio away from those regions that face a direct (US and UK) or indirect (EM) headwind from tighter monetary policy. Within fixed income, we have rotated some of the exposure into US and European high yield as we move towards a US rate hike.
“Looking forward, we expect our central scenario of meaningful divergence in regional monetary policy and asset class performance to remain, as the majority of central banks maintain a accommodative policy while the Federal Reserve moves closer towards tightening policy. This divergence should be accompanied by higher volatility, which will require us to remain flexible in both asset allocation and risk management as we seek to reduce portfolio volatility and to take advantage of opportunities that are presented. ”
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[1] Schroder International Selection Fund is referred to as Schroder ISF.
[2] Source: Schroders, as at 31 March 2015.
[3] Source: Schroders, as at 31 March 2015. The ongoing charge for the share class shown is 1.56%. Annualised performance since inception date of 18 April 2012 for A Acc share class.
[4] The fund aims to deliver a sustainable annual income of 5 per cent with an annual return target of 7 per cent. The percentages mentioned are targets and not guaranteed.
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