Insight applied in multiple ways
Information advantage matters when actively investing, and the importance of insight generated through intense research efforts shouldn’ t be underestimated. That information advantage can be applied in many ways in an actively managed multi-asset portfolio. It could be asset allocation decisions driven by analysis of macro-economic data and trends together with valuation differentials between asset classes and geographies. At the stock level it’ s about picking companies with real potential, often quality businesses with strong competitive advantages. In conditions such as we have seen this year, it may be sensible to emphasise domestically orientated businesses that are less exposed to the uncertainties of global trade, and / or companies enjoying strong pricing power that are able to pass off higher costs to their customer base.
Value is key to investment success
Investment guru Warren Buffet once commented that‘ Price is what you pay. Value is what you get’ – a statement further underlining a potential benefit of active management. Assessing value as part of any investment decision is a key determinant of its long-term success. It is one thing to identify a compelling investment case, but if valuation isn’ t considered then it could be that any future potential may already be reflected in the price, thus offering little room for upside. Contrast this with a passive approach, investing at the prevailing‘ price’ purely as a function of a company’ s index weighting.
Equities remain our favoured asset class
Shares can play an important role in any diversified portfolio, providing growth( and income) potential. This year we have seen investors rotate between‘ risk-on’ to‘ risk-off’ stances as news flows fluctuate. Within our equity components we have made some adjustments to geographic exposures but on the whole, we are cautiously optimistic on the asset class. The overall economic backdrop remains relatively supportive and company borrowing levels restrained. For now, we maintain a modest overweight stance relative to our respective benchmarks and could use any future weakness as an opportunity to selectively increase weightings.
For fund information and general enquiries contact our UK Wholesale Client Service Team:
Telephone 020 7464 5855 * Email clientsupport @ columbiathreadneedle. com
* Please note calls are recorded
IMPORTANT INFORMATION: Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies. For professional investors only. This financial promotion is issued for marketing and information purposes only by Columbia Threadneedle Investments in the UK.
The Fund is a sub fund of Columbia Threadneedle( UK) ICVC III, an open ended investment company( OEIC), registered in the UK and authorised by the Financial Conduct Authority( FCA).
English language copies of the Fund’ s Prospectus, summarised investor rights, English language copies of the key investor information document( KIID) can be obtained from Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London, EC4N 6AG, email: sales. support @ columbiathreadneedle. com or electronically at www. columbiathreadneedle. com. Please read the Prospectus before taking any investment decision.
The information provided in the marketing material does not constitute, and should not be construed as, investment advice or a recommendation to buy, sell or otherwise transact in the Funds. The manager has the right to terminate the arrangements made for marketing.
Financial promotions are issued for marketing and information purposes; in the United Kingdom by Columbia Threadneedle Management Limited, which is authorised and regulated by the Financial Conduct Authority.
58 | The Adviser