Dynamic Planner and MSCI launch risk-targeted benchmarks

3 December 2019

Dynamic Planner has launched a series of risk-targeted benchmarks to help advisers compare the performance of funds for the risk involved. 

The risk profiler has teamed up with MSCI to create the Multi-Asset Indexes – Dynamic Planner Module which will sit within its Dynamic Planner financial planning system.

Advisers and investors currently face a multitude of benchmarks self-selected by fund managers but the lack of a risk-targeted benchmark makes the ability to compare funds on a like-for-like basis with risk comparisons very challenging, the group said.

The Multi-Asset Indexes – Dynamic Planner Module is made up of ten indexes based on weightings provided by Dynamic Planner that can be used as benchmarks to compare the performance of thousands of fund portfolios.

The benchmarks are based on a set of model portfolios optimised for ten risk levels from low risk to high risk.

Ben Goss, CEO, Dynamic Planner, said: “Over the last two years the FCA’s Asset Management Market Study has brought to the fore the importance of demonstrating returns for the risk taken by the investor. Until now, there has not been a credible way in which to show this.  We have worked with MSCI to fill this void and deliver this suite of independent risk-targeted benchmarks to UK advice firms and investors.

“The Dynamic Planner Indexes will quite literally transform the way in which advisers and investors are able to review and track the performance of funds against a given risk profile.”

Dynamic Planner said the benchmarks would track the underlying performance of its asset and risk model dating back to 30 September 2005.

Steven Kowal, head of wealth, index products, EMEA, MSCI, added: “There has been a longstanding demand in the wealth marketplace for multi-asset class indexes that can serve as benchmarks for portfolios that are primarily risk-targeted rather than return-targeted. MSCI’s collaboration with Dynamic Planner, a recognised leader in fund risk profiling for the UK wealth community, aims to fill this void.”

Professional Paraplanner