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Matias Mottola, Morningstar
As investors search for more attractive returns and alternative ways for income payouts, mixed asset funds have become more popular in Asia.
Some investors have also sought absolute returns in mixed-asset strategies and dynamic allocations to minimise volatility in their overall portfolios.
The sector saw a robust asset growth of 36.5% and 20.5% in 2020 and 2021 respectively, according to a recent report published by Boston-based research firm Cerulli Associates.
The firm expects mixed-asset products to continue to gain traction in Asia amid the ongoing political tensions and uncertainty regarding the Fed’s rate hikes.
The popularity of mixed asset funds in the region has also been noted by Broadridge Financial, a US-based data analytics and fintech firm.
In a report published late last year, the company expects the AUM of the sector to grow at a CAGR of 22% over the next five years from $933bn in 2020 to $2.5trn in 2025.
That will account for 31% of the market share in 2025, up from 24% at the end of last year.
Against this background, FSA asked Matias Mottola, director of manager research at Morningstar, to select two US dollar moderate (mixed) allocation funds for comparison. He chose: the BlackRock GF Global Multi-Asset Income Fund and the Fidelity Global Multi Asset Income Fund.
|Managers||Michael Fredericks, Justin Christofel, Alex Shingle||Eugene Philalithis, George Efstathopoulos|
|Three-year cumulative return||8.66%||1.87%|
|Three-year annualised return||3.22%||0.95%|
|Three-year annualised alpha||1.39||-0.92|
|Three-year annualised volatility||8.71%||9.21%|
|Three-year information ratio||0.15||-0.32|
|Morningstar star rating||***||**|
|Morningstar analyst rating||Neutral||Neutral|
|FE Crown fund rating||**||*|
|OCF (retail share class)||1.78%||1.66%|