F&C poised to launch 'Lifestyle' funds with key distributors

F&C Investments has revealed to City analysts at its annual results presentation that it is poised to launch a suite of four new "Lifestyle" funds of funds at the end of March.

Lifestyle funds are managed portfolios which provide an asset mix tailored to fit the risk and return profile of specific categories of investor. Such funds are big business in the US mutual funds market, often regarded as an indicator of future product trends elsewhere, with a compound annual growth rate in assets under management of 39% over the last decade.

F&C disclosed that its Lifestyle fund launches will be backed up by a pipeline of key intermediary distribution deals including one with Paradigm, the new adviser platform launched by Paul Hogarth, the former Chief Executive of Bankhall, the UK's largest IFA network. The portfolios will be designed to match asset allocations derived from Distribution Technology's 'Dynamic Planner' risk profiling tool with the underlying funds selected by F&C's top rated multi-manager process and team headed up by Citywire AA rated Richard Philbin. The asset allocation on each fund will be rebased quarterly to reflect the appropriate risk profiles generated by Dynamic Planner. The four UK domiciled NURS OEIC funds being launched are F&C Lifestyle Growth, F&C Lifestyle Balanced, F&C Lifestyle Cautious and F&C Lifestyle Defensive.

F&C believes that Lifestyle funds have significant potential in the UK market arguing that investors increasingly want solutions rather than products and that, with an ever tougher regulatory environment, advisers must look to ensure that clients' overall investment portfolios remain suited to their risk profiles as well as ensure that the client is invested in the right underlying funds.

Nick Criticos, Head of Global Retail at F&C, commented: "Even initially well constructed, balanced portfolios with the right asset allocation and a good choice of funds can drift over time into a shape that no longer meets the client objectives or risk profile. Combine this with the need to constantly monitor individual fund holdings in an industry where this year's star could become next year's dog and it is easy to understand the challenge faced by advisers to ensure that they do not inadvertently expose clients to undue risk. Against this backdrop, our Lifestyle funds represent an important development for F&C's fast-growing retail business and further demonstrate our solutions driven approach to working with financial advisers."

"It is also a further milestone for our multi-manager business, an area in which F&C have been an innovator since 1987. Our team has a proven strong record, recently endorsed by S&P Fund Research upgrades on the existing funds to AA status, and we are confident that they will deliver excellent performance on the Lifestyle funds as well."

Ben Goss, Chief Executive of Distribution Technology, said: "Distribution Technology is delighted to be working with F&C and it is testament to the strength and quality of our asset allocation solutions that we have been selected to support this partnership. Our Dynamic Planner application enables intermediaries to effectively and reliably risk rate their clients, generate a considered asset allocation and then feed it through into a multi-manager product to ensure that the portfolio remains appropriate to the client profile. The intermediary will be even more productive than before and better equipped to add value to their clients."

Paul Hogarth, Chief Executive of Paradigm Partners, said: "Paradigm is excited about partnering with F&C to offer advisers on our platform a solution which will ensure that client assets are continually managed to match their risk profile and objectives. We have been impressed with F&C's robust multi-manager fund selection process which has been extremely effective in identifying funds with consistent performance and which fits well alongside a clear approach to risk profiling driven by the adviser interacting with the client."