Asset allocation: the biggest decision of all

These are complex times for anyone looking at different asset investment options for clients. Unsurprisingly, given the rise of the personal pension, the range of appropriate longer-term solutions for investors is now increasing rapidly. Investors have tended to look for vehicles that take control of asset allocation decisions but with the rise of multi-asset portfolios and funds of funds, this looks to be growing more difficult

There has always been a general demand for vehicles that allowed investors to delegate diversification decisions to professional asset allocators, but this demand has not been particularly well met in the past. This situation came to a head in the 2000-2003 bear market debacle when the passive reliance of traditional balanced pension offerings and insurance funds on equity beta was cruelly exposed. The availability of multi-asset solutions in the general retail arena was remarkably limited until relatively recently. The table below shows how rapidly this is changing, although according to...