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Paraplanner’s input to update of Fidelity funds range

10 July 2018

Martin Green, paraplanner manager at Chadney Bulgin, recently provided input to Fidelity on a range of funds the international asset management group wanted to update. Paraplanners can use their knowledge, experience and integrity to not only affect best practice in firms but to help providers create useful products, he tells editor Rob Kingsbury

What was the project you worked on with Fidelity?

The project started as Chadney Bulgin looking for a fund manager to run a number of portfolios, across the risk range, that we wanted for our clients. We have a well thought out and long-held investment philosophy, which is to keep costs low, not to try to predict what markets will do and look for diversity using a multi-asset global exposure strategy.

We believe in a static strategic asset allocation depending on the risk level (typically 60/40, 80/20 allocations made up of equities and fixed interest), with regular rebalancing. We use fixed interest as a risk dampener, avoiding high yield, and diversification aligned to market capitalisation. What we don’t believe in is applying a tactical overlay.

We went to several fund houses to see if they could match our need but no-one was able to do so. We thought we weren’t going to be able to achieve what we wanted and then Fidelity came back to us. They said they had been looking to change the investment strategy on one of their fund ranges and they liked our strategy and believed it would appeal to other financial planning firms, so would we go in and help them develop that strategy and restructure the range.

How did you get involved in the project?

As paraplanner manager I work closely with the senior management, having particular input on issues affecting the paraplanning team and I’m the paraplanning representative on the investment committee. Hence, I was part of the project team looking at building the portfolios that we wanted. So it made sense that when Fidelity approached us I was involved in meeting with them and helping to steer the strategy in the way we envisaged.

What was your practical involvement?

As well as being involved in the original project work I became a key part of the project team working with Fidelity. It meant travelling to Fidelity’s office for meetings over several months, where we engaged with various members of management and the fund managers involved in the fund range. We explained what we were looking for and using our research, calculations and graphs, broke the strategy down, going through things line by line, drilling down into the detail, so they could understand our investment thinking.

Then we talked through how the new fund range might work and what changes were needed to bring the current funds in line with what was wanted.

The fund managers already had a defined multi-asset allocation strategy. What we brought to the table was the strategic thinking, looking at things from the perspective not just of a financial planning firm but of our clients.

After the final meeting, I brought the ideas back to our investment committee and Fidelity presented too. Once it was all agreed, plans were made to make the changes needed – Fidelity had to write to all the shareholders in the existing funds explaining the new strategy and what was going to happen.

How did you find the experience?

It was an exciting project to be involved with and I thoroughly enjoyed the whole process.

What was great was not only meeting a range of investment professionals and listening to their thinking but having access to Fidelity’s immense investment resources, which made the considerable amount of number crunching far easier.

It was fantastic also, knowing that a small financial planning firm from Hampshire that had developed its investment philosophy over many years, could influence an international fund manager like Fidelity and bring something to the table that they found not only interesting but wanted to adopt within their fund range.

On a personal level I learned a lot by going through the process. I came out of it able to better articulate my ideas and I learned a lot about business relationships. Most of all I learned the influence that paraplanners can have not just within their own firms but on the wider market.

Would you recommend other paraplanners get involved in similar projects?

Absolutely; wherever you can get involved, do it. I’m lucky in that Chadney Bulgin is a progressive company which is not afraid of making changes if they are in the best interests of the client and the firm and actively encourages the team to have ideas and to get involved in projects where their skills and knowledge can make a difference. Having paraplanner involvement in the investment committee is a case in point. It’s not always easy and you have to be prepared when called upon to go the extra mile but I’d say if you have ideas, put them forward. As paraplanners we are perfectly placed to shake the tree.

The Fidelity fund range developed with Chadney Bulgin consists of:

Fidelity Multi-Asset Allocator Defensive

Fidelity Multi-Asset Allocator Growth

Fidelity Multi-Asset Allocator Strategic

Fidelity Multi-Asset Allocator Adventurous