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The growing appeal of multi-asset funds

Date: 18th March 2019

It’s no secret that, in recent times, a combination of geopolitical uncertainties, weaker growth and increased volatility has heightened awareness of risk amongst investors. And this, in turn, has sparked fresh interest in multi-asset funds, as investors try to manage risk and protect capital whilst also seeking growth opportunities.

Why invest in multi-asset funds?
Multi-asset funds invest in a combination of asset classes, which typically include equities and bonds, but can also cover a wider range of assets such as property and commodities. Their appeal is that they provide diversification and thus ensure investors ‘do not put all their eggs in one basket’.

Surge in sales
Increased interest in this sector has fuelled a surge of new money into existing funds and a flurry of new fund launches too. According to Morningstar, there are now 1,027 UK domiciled multi-asset funds, while Investment Association data shows the mixed-asset sector was last year’s bestselling asset class with net retail sales of £7.9 billion.

While the wide choice of funds is clearly great news for investors, it has enhanced the need to seek advice.