Elston has launched the Smoothed MPS and Smoothed Retirement MPS ranges on Aviva’s pension portfolio, ISA portfolio and onshore bond wrappers.
The Elston Smoothed ASF portfolios are targeted at advisers who traditionally blend multi-asset funds and smoothed funds for clients in accumulation but offer greater consistency for implementation and rebalancing by using a managed framework.
The Elston Smoothed Retirement ASF portfolios are designed for advisers who traditionally blend a cash bucket with a smoothed fund for clients in decumulation. The portfolios are made up of a near-term liquidity bucket, a medium-term stabiliser bucket and a long-term smoothed bucket which has an allocation to an Aviva Smoothed Fund.
Elston said that by splitting a retirement portfolio across a near-term, medium-term and long-term bucket, and keeping those buckets topped up on a managed basis, sequencing risk can be mitigated.
The firm added that studies have shown a periodic rebalancing framework provides more consistent outcomes than advisers attempting to time the market with switches between buckets.
Henry Cobbe, founder and head of research at Elston Consulting, said: “Smoothed Funds can help the client experience of market risk. They therefore have a useful role to play in a retirement context for certain client segments.
“Speaking to our adviser community, we found there was interest in moving beyond an “all or nothing” approach to smoothed funds.”
Lorna Whalley, commercial director of Aviva’s Adviser Platform, added: “We are delighted to see Elston leading innovation by incorporating the Aviva Smoothed Managed Fund into their Smoothed Retirement models, designed specifically for decumulation.
“Smoothed funds have a valuable role in helping to manage sequencing risk in retirement, and Elston’s Smoothed MPS provides advisers with a timely and differentiated solution in response to the regulator’s Thematic Review on Retirement Income Advice.”
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