Schroders adjusts fund objectives in light of challenging markets
Schroders has changed the objectives of its Real Return funds as it believes market conditions have made it more difficult to achieve the funds’ targets.
In a note to the Australian Securities Exchange (ASX), the firm said real cash rates and bond yields had fallen substantially which meant seeking above-inflation returns were “significantly challenged”.
“Market conditions have progressively made it more difficult to consistently achieve both the return and risk objectives of our Real Returns fund,” it said.
“Until recently, we believed these were reasonable targets to pursue, however the COVID-19 pandemic has now tipped the balance.
“The pandemic is impacting economies and markets around the world to such an extent that we believe investors to recalibrate their return expectations.”
The Schroder Real Return CPI Plus 3.5% fund name had changed to Schroder Multi-Asset Income, Schroder Real Return CPI Plus 5% would be the Schroder Real Return, and Schroder Real Return (managed fund) would remain the same.
On the Schroder Real Return CPI Plus 3.5% fund, distribution payments would change from quarterly to monthly as investors were seeking more regular income and the maximum exposure to growth assets in the funds would decrease to minimise the volatility of returns.
The changes would take place from 1 March, 2021.
Fund changes for Schroder Real Return range
AUTHOR
Laura Dew
Recommended for you
VanEck is expanding its fixed income range with a new ETF this week to complement its existing subordinated debt strategy which has received $1 billion in inflows this year.
Specialist global equities manager Nanuk has celebrated 10 years of its flagship New World Fund and is actively considering its next possible vehicle.
Australian equities manager Datt Capital has built a retail-friendly version of its small-cap strategy for advisers, previously only available for wholesale investors.
The dominance of passive funds is having a knock-on effect on Australia’s M&A environment by creating a less responsive shareholder base, according to law firm Minter Ellison.
