Moneyfarm has launched its Absolute Return Strategy to help clients target returns in an increasingly uncertain market environment.
The new strategy will give investors access to investment approaches typically reserved for institutional portfolios.
Moneyfarm said a combination of geopolitical tensions, changing interest rate expectations and ongoing market volatility has left investors looking for ways to remain invested without taking on the full risks associated with traditional stock and bond markets.
Rather than relying on the performance of a single asset class, the Absolute Return Strategy draws on a range of investment strategies designed to perform across different market conditions. The portfolio combines a range of bond, equity and currency strategies designed to perform whether markets rise or fall.
With a recommended investment horizon of three to six years, the digital wealth manager said it sits between cash-based solutions and higher-risk growth investments within the group’s range.
Chris Rudden, head of investment consultants UK at Moneyfarm, said: “Investors have become increasingly concerned about how to protect and grow their wealth in an environment where traditional stock and bond markets can experience periods of heightened volatility. At the same time, remaining in cash for too long can erode purchasing power and limit long-term growth opportunities.
“The Absolute Return Strategy has been designed to help address this challenge by offering a flexible, diversified approach that seeks to generate returns across different market environments. It provides clients with another way to stay invested while reducing their dependence on the direction of traditional equity and bond markets.
“As investors seek greater diversification and resilience, we believe absolute return strategies can play an increasingly important role alongside traditional portfolio allocations.”
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