Resilient outcomes

Why defence is the best form of attack

Capital markets were challenging to navigate in 2020, but it was possible to deliver a positive return primarily driven by resilient income; the Global Multi-Asset Income Fund (GMAI) did so for a seventh consecutive year. In our view, GMAI’s approach to seeking defensive returns with relatively lower volatility makes it a reliable core holding in an investor’s portfolio, especially in the current environment.

Jan 29, 2021

8 minutes

Jason Borbora-Sheen
Ellie Clapton
Capital markets were challenging to navigate in 2020, but it was possible to deliver a positive return primarily driven by resilient income; the Global Multi-Asset Income Fund (GMAI) did so for a seventh consecutive year. In our view, GMAI’s approach to seeking defensive returns with relatively lower volatility makes it a reliable core holding in an investor’s portfolio, especially in the current environment.

The fast view

  • GMAI aims to offer both downside protection and upside participation
  • The Fund adopts a total return approach, using income as the engine
  • Our process is straightforward but effective, aided by a flexible toolkit
  • We believe GMAI’s approach makes it a reliable core holding

Capital markets were challenging to navigate in 2020, but it was possible to deliver a positive return primarily driven by resilient income; the Global Multi-Asset Income Fund (GMAI) did so for an seventh consecutive year, offering protection during weaker markets in addition to upside participation; this versatility is down to three core elements of its philosophy.

The Fund adopts a total return approach, using income as the engine of performance; our process is straightforward but effective, enabling us to protect against the downside; and finally, our process is aided by the ability to invest across a wide variety of asset classes with a flexible toolkit.

We believe GMAI’s track record of delivering defensive returns with relatively lower volatility1 makes it a reliable core holding in an investor’s portfolio, especially in the current climate, with markets increasingly volatile and risk assets expensive following their significant recovery last year.


GMAI has provided downside protection during market drawdowns, and swiftly recovered any weakness

 GMAI provides downside protection during market drawdowns, and swiftly recovers any weakness

Past performance is not a reliable indicator of future results, losses may be made.

Calendar year returns for the Fund (A Acc USD); 2020: 5.0%; 2019: 6.2%; 2018: 0.5%; 2017: 6.0%; 2016: 4.4%; 2015: 0.9%; 2014: 3.7%.
Source: Morningstar, 31 December 2020. Period shown is since 30 September 2013. Performance is net of fees (NAV based, including ongoing charges, excluding initial charges), gross income reinvested, USD.
Highest and lowest returns achieved during a Rolling 12 month period since inception: Aug-14: 8.7% and Mar-20: -4.6%.
The MSCI ACWI index is included to illustrate prevailing market conditions / events since inception of the fund.
The Fund is actively managed. Any index is shown for illustrative purposes only.

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1 Defined as less than half that of global equities (MSCI ACWI).

General risks
The value of investments, and any income generated from them, can fall as well as rise. Where charges are taken from capital, this may constrain future growth. Past performance is not a reliable indicator of future results. If any currency differs from the investor's home currency, returns may increase or decrease as a result of currency fluctuations. Investment objectives and performance targets are subject to change and may not necessarily be achieved, losses may be made.

Specific risks
Currency exchange: Changes in the relative values of different currencies may adversely affect the value of investments and any related income. Default: There is a risk that the issuers of fixed income investments (e.g. bonds) may not be able to meet interest payments nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and therefore investment loss. Derivatives: The use of derivatives may increase overall risk by magnifying the effect of both gains and losses leading to large changes in value and potentially large financial loss. A counterparty to a derivative transaction may fail to meet its obligations which may also lead to a financial loss. Interest rate: The value of fixed income investments (e.g. bonds) tends to decrease when interest rates rise. Equity investment: The value of equities (e.g. shares) and equity-related investments may vary according to company profits and future prospects as well as more general market factors. In the event of a company default (e.g. insolvency), the owners of their equity rank last in terms of any financial payment from that company. Government securities exposure: The Fund may invest more than 35% of its assets in securities issued or guaranteed by a permitted sovereign entity, as defined in the definitions section of the Fund’s prospectus. Emerging market (inc. China): These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems.

 
Jason Borbora-Sheen
Portfolio Manager
Ellie Clapton
Portfolio Specialist

Important information
This is an advertising communication for institutional investors and financial advisors only, it is not for general public distribution.
In the US, this communication should only be read by institutional investors, professional financial advisors and, at their exclusive discretion, their eligible clients. It must not be distributed to US Persons apart from the aforementioned recipients. THIS INVESTMENT IS NOT FOR SALE TO US PERSONS EXCEPT QUALIFIED PURCHASERS.
All the information contained in this communication is believed to be reliable but may be inaccurate or incomplete. Any opinions stated are honestly held but are not guaranteed and should not be relied upon.
The Fund is a sub-fund of the Ninety One Global Strategy Fund, which is a UCITS organised as a Société d’Investissement à Capital Variable under the law of Luxembourg. Ninety One Luxembourg S.A. (registered in Luxembourg No. B 162485 and regulated by the Commission de Surveillance du Secteur Financier) is the Manager of the Fund. This communication is not an invitation to make an investment nor does it constitute an offer for sale. Any decision to invest in the Fund should be made after reviewing the full offering documentation, including the Prospectus, which sets out the fund specific risks.
Fund prices and English language copies of the Prospectus, annual and semi-annual Report & Accounts, Articles of Incorporation and local language copies of the Key Investor Information Documents may be obtained from www.ninetyone.com. In Switzerland, this information is available free of charge from - RBC Investor Services Bank S.A., Esch-sur-Alzette, Bliecherweg 7, CH-8027 Zurich, Switzerland. In Spain, the Ninety One Global Strategy Fund is registered with the Comisión Nacional de Mercados y Valores as a foreign collective investment scheme marketed in Spain, with the number 734.