Winning with a strong investment committee
Having an experienced investment committee and a strong investment governance structure has given the IOOF Balanced Investor Trust fund the edge to win Money Management’s Multi Asset – Balanced award for 2020.
IOOF’s chief investment officer, Dan Farmer, said his fund had been performing well prior to COVID-19 and had taken a more defensive position towards to end of 2019.
“We reshaped our defensive assets to make them less dependent on interest rates and credit spreads. In our fixed interest portfolios we reduced our reliance on duration and introduced relative value management,” he said.
“This is designed to perform well in volatility and deliver good returns regardless of where credit spreads and duration are headed so that move towards relative value in fixed interest really helped us during the COVID-19 sell-off period.
“So, it was a combination of asset allocation, a focus on active management and positioning the portfolio in a more defensive manner through 2019 that drove the performance over the last 12 months.”
Farmer noted that the team had a strong performance culture as they focused on what mattered to clients.
“All the teams spend time with advisers and understand client needs and are driven by outcomes – how we are performing not only in surveys but on how absolute returns look, and we make sure risk is appropriate for each client cohort,” he said.
“The teams are also focused on having an empowered team so every member in the investment team can contribute to outcomes so they are all very experienced and that experience is reflected in how we position portfolios.”
Farmer said the fund’s investment philosophy was to be active and well diversified, and willing to look into a wide range of strategies, managers and asset class niches.
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