Investors who are transitioning to retirement will benefit from the increasing availability of differentiated global long/short strategies, according to Zenith Investment Partners.
Zenith said there had been a number of new and differentiated investment strategies over the last couple of years, providing investors with greater choice for portfolio construction
Zenith’s senior investment analyst, Justin Tay, said: “Historically, the global long/short space has been relatively limited with regards to the breadth of investment options available, so this is a positive. We are finding there are now strategies that fill previously vacant segments of the risk spectrum”.
Tay said the relatively recent introduction of managed risk strategies were designed to allow investors to gain an exposure to equity markets whilst limiting the associated performance drawdowns.
“We view managed risk strategies as an appealing option for those investors who are transitioning to retirement for example. This is the time when investors are most exposed to sequencing risk and cannot afford a material loss of invested capital,” he said.
Tay noted that Zenith believed global long/short funds were able to generate stable absolute returns whilst preserving capital and to generate outsized returns above equity markets.
“Intuitively, these two roles sit on opposite sides of the risk spectrum,” Tay said.
