Every month we study the universe of funds in the investment marketplace to assess whether they meet our exacting standards and should be given the RSMR seal of approval.
The fund’s investment philosophy is based on three pillars, namely Avoid (companies with damaging or unsustainable business practices), Invest (in companies that make a positive contribution to society and the environment) and Improve (use influence as an investor to encourage best practice management of ESG issues through engagement and voting).
This fund combines positive and negative SRI screening criteria with BMO’s equity investment process through separate analysis to produce a diversified UK equity portfolio. The fund is managed by an experienced and well-resourced team supported by the wider Responsible Investment team and the Responsible Investment Advisory Council. The portfolio is constructed with between 60 and 75 securities and although there is no set weighting in mid-cap and small-cap stocks, the fund typically maintains a weighting of 40-50% in these stocks, with the team viewing them as a good source for investment ideas.
The BMO Universal Multi-Asset Portfolio range is an actively managed suite of low-cost, globally diversified, multi-asset solutions. The range was originally a set of three multi asset portfolios (Cautious, Balanced and Growth) run to a set of return and volatility targets. Two more funds were launched in October 2019 (Defensive and Adventurous), run under the same investment process. The range has been designed on three key principles; risk controlled with a CPI + return expectation; cost focused with an OCF capped at 0.29%; and active which combines strategic and tactical allocations with individual stock selection.
The Baillie Gifford Strategic Bond Fund is managed on a bottom up basis with an emphasis on delivering returns through strong stock picking in credit. There is a global unconstrained approach to credits held, although there is always diversification in the portfolio. The fund has a low emphasis on macro asset allocation calls versus many in the peer group. Asset allocation is long-term in nature with relatively small strategic tilts. The managers utilise the strengths of Baillie Gifford as an investment house by focussing on strong sectors and companies which demonstrate a pathway of growth and economic resilience. The fund is competitively priced and is suitable for long-term bond investors who wish to have an emphasis on credit (corporate bonds) in their portfolio.
The fund offers investors an absolute return approach to bond markets with no index benchmark. The fund looks to deliver returns through top down themes and asset allocation positioning. The fund is likely to offer investors an above average income through the strategy of hedging out risk in ways which do not compromise portfolio yield. The fund is also looking to deliver capital gains to investors when market opportunities are favourable. Asset allocation is actively managed and the fund is dependent on manager skill to generate returns, relying on the considerable flair of lead manager Dickie Hodges.