Investment trusts covered by Dynamic Planner risk profiling

27 August 2020

Dynamic Planner has expanded its risk profiling service to include investment trusts, in a move that could help encourage their wider use within financial advice.  

Seneca Global Income & Growth Trust has become the first investment trust to be included, receiving an assigned risk profile of 7 out of a possible 10.

Dynamic Planner said it carried out in-depth analysis of the underlying holdings of the trust, dating back a period of several months, and calibrated those with its latest capital market assumptions to assess its volatility.

Chris Jones, proposition director, Dynamic Planner (pictured), said: “Investment trusts are the investment vehicle of choice for many investors, and while choice is all important, we believe it’s also vital to maintain a consistency of approach when assessing suitable investment solutions.

“For over 17 years we have helped thousands of advisers understand the risk profile of thousands of model portfolios and open-ended funds. We can apply this same trusted model to assess the risk profile of investment trusts because we analyse all the risk characteristics of the underlying holdings of any solution.”

David Thomas, chief executive, Seneca Investment Managers, commented: “We were keen to have this analysis undertaken, since Dynamic Planner has provided formal risk profiling oversight of our similar open-ended multi-asset funds for a number of years. We are very comfortable with their rigorous process and saw no reason to exclude the Trust just because it was closed-ended, given its inherent multi-asset diversification and the tight Board control over the level of gearing applied to the underlying assets.”

Dynamic Planner currently risk profiles over 1,400 model portfolios and open-ended funds and plans to further increase the investment trusts available. It says advisers will be able to apply the same consistency of approach when assessing the suitability of different investment solutions.

Nick Britton, head of intermediary communication, Association of Investment Companies, added: “As part of our ongoing education programme, we’ve trained thousands of financial advisers about investment trusts, and we’re keen to break down barriers to their wider use wherever possible.

“One of these barriers has been the lack of availability of risk-profiling for investment trusts, which many advisers have told us is essential to their research process. This news from Dynamic Planner is an encouraging sign that one more barrier to investment trust use is on the way to being removed, smoothing the path to wider adoption of investment trusts among financial advisers.”


Professional Paraplanner