Manulife Investments has partnered with Maybank to launch “Manulife Empower Solutions”, a customisable suite of investment funds catered to the Singaporean retirement market.
The companies said the solution will allow investors to adjust their retirement portfolios depending on their changing needs and risk appetites as they age.
The partnership will take an open architecture approach, with four funds developed and managed by Manulife Investments’ multi-asset solutions team.
Marc Franklin, senior portfolio manager, deputy head of multi-asset solutions, Asia, Manulife Investments told FSA in an interview that the four funds will be a combination of both “best of breed” active strategies and cost-effective passive funds.
“Unlike some investment or retirement solutions on the market, we don’t just limit the end investors to Manulife strategies,” he said. “We are looking across the whole market, both active and passive, and if we find high quality performing funds and cost-effective ETFs, they will make the cut.”
In its current form, Franklin said roughly 30% of portfolios are in actively managed Manulife funds, and roughly 10% are with third party active managers. The remaining 55% to 60% are in passive funds.
Franklin said the multi-asset team uses an independent manager research function within Manulife Investments to provide qualitative reviews of internal and external managers.
“We are completely agnostic to whether it’s an internal strategy or an external manager. We just want the best,” he said. “It just so happens that based on our allocation mix, we’ve identified about five or six Manulife strategies and we’ve got another five or six active managers that also screen really well and are cost effective.”
Franklin revealed that one of the active mandates they have selected is an emerging markets debt manager which has compounded alpha over 200 basis points per year over a long period of time.
Whereas on the passive side, he said they’ve selected US Treasury ETFs as well as a US small cap industrials ETF, both based on prevailing investment views from the multi-asset team at Manulife Investments.
Unlike target-date funds which have a fixed retirement age and a portfolio allocation based on a certain date, Franklin said a major benefit of the Empowered Solutions fund range is that it is customisable if one decides to retire early or needs more income to pay for a grandchild’s education, for example.
Hui-Jian Koh, chief executive officer, Singapore, Manulife Investments said: “Existing retirement solutions often rely on pre-determined risk profiles at inception, which may not adapt to changes in an investor’s risk tolerance, income, or retirement age.”
“This rigidity could result in investors being under-invested or overly cautious, potentially limiting their returns and hence ability to achieve their retirement goals.”
“The Empower Solutions are structured to fill this gap by offering the flexibility to adapt both leading up to and throughout one’s retirement.”
