"Instead, we would construct a bespoke portfolio with a mix of diversified funds that matched the client’s attitude to risk.
"The portfolio could consist of higher risk and lower risk funds, just as long as the overall portfolio matches the client risk profile.”
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Shane Balkham, chief investment officer at Model Portfolio provider Beaufort, says a useful way to understand a fund and the likely level of volatility in the short-term is to “pin” an investment style on it, and once you understand that, you have an idea of what the volatility may be like, as the style could be in or out of favour at any particular time.
david.thorpe@ft.com
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