Multi-asset funds are simply a modern version of mixed funds. Mixed funds have been on the market for quite some time and are known to be more appealing than single asset based funds, since they offer you the benefit of diversification. A mixed fund, unlike a pure bond or equity fund, includes both these classes and various other types of investments. Richard Cayne of Meyer International explains that such inherent diversification of a mixed fund gives you the advantage of avoiding any major losses even if one asset class drops and tries to make sure or balance your portfolio so it can perform under all kinds of market conditions.
Richard Cayne of Meyer International comments that most individuals often wonder whether it makes sense to pay the fees associated with the management of multi-asset funds or not, here’s an evaluation. One of the most compelling reasons for putting together and managing your own multi-asset fund would be that no one might understand your goals and care for your assets like you would. This also involves having the liberty to pick and choose asset classes that appeal to you. However, Richard Cayne of Meyer International explains that this can be easily resolved by looking for a fund manager who is not only competent, but also diligent. This way, paying a professional who understands your goals a fee to look after your assets and bring in his/her years of expertise would make more sense.
Richard Cayne of Meyer International comments that some individuals are still not convinced whether the fee associated with multi-asset funds justifies the services offered by a professional manager. In order to evaluate the above, we would need to look into what’s at stake if you plan on actively managing your multi-asset fund. Two of the major factors to consider in active management are time and interest. Richard Cayne of Meyer International opines that if you are an individual who fervently follows the market and has a good grip on its various asset classes, then active management can actually work in your favor. For those who have the time and energy to keep a keen eye on the various asset classes of investment they may indeed become successful. However,
Richard Cayne of Meyer International advises that individuals who do not have the time to invest in daily research and updates, hiring a professional will make better sense.
Besides the availability of time and inclination of interest, Richard Cayne of Meyer International mentions emotional detachment as a key element to successful portfolio management. While a fund manager will always make objective and rational decisions due to his/her training and experience, it can be quite difficult for you to keep your emotions at bay while taking important decisions. One of the strongest emotions to look out for is fear; the fear of bad economic weather, sudden volatility of the market, etc. can make you lose more than you gain. Therefore, individuals who are confident in their decision making skills and have the time and inclination to study the markets should consider self managing a portfolio of assets; however, for the others, a professional manager may be a better choice.
