A strict investment process that delivers strong income with minimal risk has seen Wingate’s Global Equity Fund – Hedged take the crown in the Retirement and Income Focused category.
“It’s very simple. We follow a process and that holds us accountable to ourselves,” Wingate chief executive, Jamie Mead, said.
“We’re a fundamental house with a bottom-up approach. While we have intellectual curiosity for macro and micro concerns, we still always start at the same point with the company’s financial accounts.”
In the retirement and incomefocused category, strategies need to concentrate on income, preferably with a lower volatility outcome.
“We offer a high rate of income, which is obviously very beneficial [to retirees], then by lowering the risk and drawdown for a retiree, we lower that sequencing risk for them.
“Speaking to longevity risk, not only are we paying out income, we are also paying out a very healthy growth component to the portfolio that delivers a very healthy return through cycle,” Mead said
Lonsec approved of Wingate’s strategy, saying its “differentiated approach to equities investing typically results in returns that are less volatile than the fund’s equity benchmark and with a higher distribution profile whilst also providing potential for ... growth.”
With FE Analytics showing that the fund’s five-year performance to last quarter end was 6.39 per cent with volatility for the last year of just 4.61, Mead’s process clearly worked.
Finalist BlackRock’s Global Multi Asset Income Fund also focused on “delivering a meaningful and consistent level of yield while closely managing risk”.
“A wide opportunity set has helped drive income ... from myriad sources while delivering low levels of risk,” said senior investment strategist David Griffith.
He cited covered calls, preferred stock, structured credit, and international equities as strong providers of this. Grant Samuel Funds Management, a finalist for its Epoch Global Equity Shareholder Yield (Hedged) Fund, targets companies that generate dividend income, leading to good downside capture.
“A happy by-product [of strong cash generation] is when markets become volatile is that these companies tend to outperform because of their transparency and ... cash-generative nature,” chief executive, Damien McIntyre, said.