Earlier this year, a number of financial advice firms we work with asked us to consider adding alternative investments to client portfolios.
Alternatives have become increasingly prominent in recent years, particularly as an option alongside traditional fixed income, and adviser interest continues to grow.
They have not historically formed part of AJ Bell’s standard offering. However, as part of our broader approach to bespoke MPS, we looked for alternative strategies that could provide relatively low correlation to both equity and bond markets while addressing current portfolio requirements.
This led us to two areas: equity market neutral and managed futures, with two funds selected within each strategy. We felt these approaches offered some potential benefits compared with other alternative asset classes that we have decided not to include for now.
Gold was also considered, and attracted interest from some clients earlier in the year. However, its performance can be heavily influenced by market sentiment and is difficult to predict.