Schroder ISF* Global Multi-Asset BalancedMost investors want reasonable returns and growth, but they also want strong risk management and portfolio resilience. Today, achieving that combination takes more asset allocation skill than it did in the past.
These are uncertain and volatile times, and we’ve seen failures of diversification when multiple asset classes fell at the same time. Bonds, traditionally a safe haven, now face headwinds from rising rates and inflation. And tomorrow’s equities may not deliver the kind of returns they did at the height of Quantitative Easing.
Not every investor has the time and resources needed to stay on top of a fast moving global opportunity set. A multi-asset manager can potentially help investors ensure they are correctly positioned for the prevailing opportunities and risks.
That’s where the Global Multi-Asset Balanced strategy comes in.
*Schroder International Selection Fund is referred to as Schroder ISF.
Our clients want to benefit from rising markets, but they want a more cautious portfolio at times of turbulence
We take advantage of a broad global opportunity, seeking the best opportunities across equities, fixed income and alternative.
An agile approach for fast-changing markets
When markets are turbulent and there’s nowhere to hide, the best defence is to be flexible in your asset allocation. Our wide investment parameters give us flexibility to try and harvest the upside in bull markets and to “de-risk” in bear markets. We take full advantage of that flexibility, making significant and sometimes rapid adjustments to our market exposures where appropriate.
More than just top down.
It’s important to get the top-down asset class mix right, but asset allocation needs to work harder than that. We exploit relative value opportunities between (for example) industries and sectors within equities and fixed income. We also compare opportunities across asset classes when choosing the best way to express a theme.
Our pick of the “best of Schroders”
In addition to our top-down asset allocation expertise, we are able to harness bottom-up security selection skill from across Schroders’ global platform. One advantage of this is knowing the detail on the ESG characteristics of everything we hold.
Complex skills but mainstream securities
The building blocks of our portfolios are typically liquid, mainstream securities, without opaque structures or exotic derivatives. We do routinely use “vanilla” derivative instruments, such as currency forwards and bond or equity index futures with the aim of achieving investment gains, reducing risk, mitigating losses in falling markets or managing the fund more efficiently.
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You can find more information, including fund literature, holdings and performance data in our fund centre.
What are the survival traits of a multi-asset manager?
As markets get tougher, fund managers need to prepare to answer tougher questions from their clients.
Schroder ISF Global Multi-Asset Balanced
Fund Manager, Multi-asset
Multi-Asset, Fund Manager
“When markets are turbulent and there’s nowhere to hide, the best defence is to be flexible.”
Fund Manager, Multi-asset
What are the risks?
- Capital risk / distribution policy: As the fund intends to pay dividends regardless of its performance, a dividend may represent a return of part of the amount you invested.
- Credit risk: A decline in the financial health of an issuer could cause the value of its bonds to fall or become worthless.
- Currency risk: The fund may lose value as a result of movements in foreign exchange rates.
- Currency risk / hedged shareclass: The hedging of the share class may not be fully effective and residual currency exposure may remain. The cost associated with hedging may impact performance and potential gains may be more limited than for unhedged share classes.
- Derivatives risk: Derivatives may be used to manage the portfolio efficiently. The fund may also materially invest in derivatives including using short selling and leverage techniques with the aim of making a return. A derivative may not perform as expected, may create losses greater than the cost of the derivative and may result in losses to the fund.
- Emerging markets & frontier risk: Emerging markets, and especially frontier markets, generally carry greater political, legal, counterparty, operational and liquidity risk than developed markets.
- High yield bond risk: High yield bonds (normally lower rated or unrated) generally carry greater market, credit and liquidity risk.
- IBOR risk: The transition of the financial markets away from the use of interbank offered rates (IBORs) to alternative reference rates may impact the valuation of certain holdings and disrupt liquidity in certain instruments. This may impact the investment performance of the fund.
- Liquidity risk: In difficult market conditions, the fund may not be able to sell a security for full value or at all. This could affect performance and could cause the fund to defer or suspend redemptions of its shares.
- Operational risk: Operational processes, including those related to the safekeeping of assets, may fail. This may result in losses to the fund.
- Performance risk: Investment objectives express an intended result but there is no guarantee that such a result will be achieved. Depending on market conditions and the macro economic environment, investment objectives may become more difficult to achieve.
- Counterparty risk: The fund may have contractual agreements with counterparties. If a counterparty is unable to fulfil their obligations, the sum that they owe to the fund may be lost in part or in whole.
- Market risk: The value of investments can go up and down and an investor may not get back the amount initially invested.
This webpage does not constitute an offer to anyone, or a solicitation by anyone, to subscribe for shares of Schroder International Selection Fund (the “Company”). Nothing in this webpage should be construed as advice and is therefore not a recommendation to buy or sell shares. An investment in the Company entails risks, which are fully described in the prospectus.
Subscriptions for shares of the Company can only be made on the basis of its latest Key Investor Information Document and prospectus, together with the latest audited annual report (and subsequent unaudited semi-annual report, if published), copies of which can be obtained, free of charge, from Schroder Investment Management (Europe) S.A.
Schroders may decide to cease the distribution of any fund(s) in any EEA country at any time but we will publish our intention to do so on our website, in line with applicable regulatory requirements.
The fund has the objective of sustainable investment within the meaning of Article 8 of Regulation (EU) 2019/2088 on Sustainability-related Disclosures in the Financial Services Sector (the “SFDR”).
Any reference to sectors/countries/stocks/securities are for illustrative purposes only and not a recommendation to buy or sell any financial instrument/securities or adopt any investment strategy.
Past Performance is not a guide to future performance and may not be repeated.
The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of investments to fall as well as rise.
Schroders has expressed its own views and opinions in this document and these may change.
A summary of investor rights may be obtained from https://www.schroders.com/en/lu/private-investor/footer/complaints-handling/
For your security, communications may be recorded or monitored.
Issued by Schroder Investment Management (Europe) S.A., 5, rue Höhenhof, L-1736 Senningerberg, Luxembourg. Registration No B 37.799.
For Luxembourg, these documents may be obtained in English, free of charge, from the following link: www.eifs.lu/schroders.