Diversify to accumulate

Although their performance and relevance has been open to debate, with-profit funds can prove to be a stable vessel for investors, particularly in times of turbulent markets

Investors all look to take advantage of strongly performing asset classes - the trick is knowing when to get into and out of a particular class. Traditionally, when one sector, for example equities, enjoys a good run, others, such as property, will be more subdued and vice versa. So in a diversified fund they would compensate for each other. In recent years, investors have seen healthy capital growth from property and a very active market thanks to the availability of cheap finance. The growth in capital has, however, been at the expense of income yield and it can be argued that this has ...