The Schroders’ objective-based multi-asset Real Return Fund CPI+5% has reached its 10-year milestone, with the strategy returning an average of 6.95 per cent per annum gross of fees over the past decade with low levels of volatility.
The fund, which is managed by Simon Doyle and Simon Stevenson, aims to deliver a return of CPI+5 per cent gross of fees over rolling three-year periods, while minimising volatility and drawdowns.
As at the end of August, Schroders managed around $9.2 billion in multi-asset, of which $8.1 billion was in the real return strategies, including $6.8 billion in the Schroder Real Return CPI+5% fund.
“We decided to revisit the approach to multi-asset investment, which attempts to reconcile an investor’s time horizon and return objectives with a fixed asset allocation strategy,” Doyle said.
“However, in order to target a fixed return over a shorter horizon — of three to five years — you have to adopt a more variable asset allocation.”
According to Stevenson, during the ten worst market drawdowns over the past decade since launch, the fund averaged drawdowns of only 1.8 per cent versus average drawdowns for the ASX200 index of 6.9 per cent.