Building Portfolios

For advisers, choosing the right investment portfolio and monitoring that it is continuing to deliver the risk-adjusted returns the client expects is critical in helping clients achieve their long-term goals. Given its importance, this process can also be extremely time-consuming and resource-intensive, reducing the valuable time advisers have to spend with their clients.

Taking the stress out

As a result, outsourcing asset allocation and fund selection is proving increasingly popular as advisers look to streamline their businesses and focus on strengthening client relationships. In doing so, however, they must be confident that their choice of outsourced solution will continue to meet the needs of their clients both now and in the future. That’s where MyFolio comes in.

Outsource for extra resource

Launched in 2010, the Standard Life Investments MyFolio fund-of-funds range meets adviser demand for cost effective,

risk-targeted solutions. It offers investors a choice of 25 funds (both active and passive) based on their risk profile and preferred investment approach. In managing the MyFolio range, we deploy extensive, experienced resource and adhere to a robust, repeatable process. For example, we set what we believe to be the best long-term strategic mix of assets for each fund, working closely with risk-modelling experts Moody’s Analytics, and then the experts within our multi-asset investing team look to take advantage of shorter-term tactical opportunities.

Meanwhile, the MyFolio fund solutions team, led by Bambos Hambi, selects an optimal blend of individual funds that make up each MyFolio portfolio. In doing so, they initially undertake rigorous fund analysis, examining a range of quantitative criteria. Funds that pass this initial assessment are then subject to further scrutiny, with managers interviewed in line with our 5P (philosophy, process, people, price, performance) analytical framework.

Follow-up meetings with the manager and members of their wider team then take place, to allow the analyst to draw together their qualitative and quantitative insight to form a view on whether to recommend the fund and examine how it should be positioned in the portfolio. This rigorous process is only made possible by having one of the largest dedicated fund solutions teams in the UK.

Consistent approach to help achieve a consistent performance

The benefits of having a large team of experts working within a consistent framework are borne out by the success of the MyFolio range. Since launch, each of the MyFolio funds has delivered risk-adjusted returns in line with expectations. Generally, higher risk levels have experienced more volatility but achieved higher long-term returns than the lower risk levels. As a result, MyFolio has been well supported by the UK adviser community, who now trust us to manage assets worth over £13 billion (as at 31 December 2017) across the range for their clients.

Looking ahead, the investment and regulatory landscape is likely to become increasingly challenging, making life even more complex for advisers. As a result, we believe that MyFolio’s vast resource, comprehensive process and proven track record makes it an ideal solution for those advisers looking to enhance their business through outsourcing.

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