Ask the Portfolio Manager

[JamesIG]

As we head into ISA season we wanted to make sure that all clients have the opportunity to interact directly with our investments teams to discuss everything from smart portfolio allocation, to stock transfers, deal execution and our share dealing offering, to ETF’s, diversification, and trade ideas for your new ISA allowance.

 

Over the coming weeks, up until Friday April 6^th, we will bring you senior sales traders, our smart portfolio managers, and our very own IG analysts Chris Beauchamp and Joshua Mahony to answer any questions you may have, so make sure you check out IG Community regularly to keep up to date and make the most out of your investments.

 

Ask the Portfolio Manager

 

I would like to introduce IG Community to  and  who are portfolio managers for IG’s ‘Smart Portfolios’. This longer term investment vehicle, built on a robust partnership with the world’s biggest asset management firm Blackrock, has just reported their year one results, and they are very positive as you can read about here.

 

The 'balanced', 'growth', and 'aggressive' portfolio allocation returns were 4.1%, 5.5% and 7.2% respectively, whilst the moderate came in at 1.8% and conservative at-0.6%. This just goes to show how a diversified exposure to a range of markets reduces volatility over the long run - exactly what you want from this product.

 

If you have any questions at all, ask away. What goes into the decision making process for portfolio allocation and risk appetite? What do you do on your day to day? What do you think are the main market risks for the UK going forwards? Now is your chance…

[Guest PandaFace]

I was looking at these smart portfolios over the weekend actually (because of this post!), and the question I had was actually quoted above: “What goes into the decision making process for portfolio allocation and risk appetite?”

 

And also can I have a smart portfolio ISA and a regular stocks and shares ISA at the same time?

 

Can I edit the smart portfolio? Like if your system put weighting into say - China equities - but I wanted to shift more to Japan or EM’s?

[Guest OliverSmithIG]

Hi ,

 

The portfolios aim to profit from long-term 'risk premia' available in different asset classes. By blending asset classes which are less correlated to each other, we hope to be able to smoothe your returns over time. There is a strong top-down element in the portfolios, and they are positioned at the moment for global reflation (albeit with room to increase equity exposure) and rising interest rates. There is a 20-strong team at BlackRock directly behind the asset allocations, and they draw on the research from BR's strategy, investment and risk teams. So a very robust framework behind the portfolios.

 

IG has flexible ISAs, and you can have both a Smart Portfolio and Share Dealing ISA with us using the same year's allowance.

 

You can't edit the Smart Portfolio, as this would change the risk and return profile of the portfolio. Personally, I use a Smart Portfolio as my core holding and trade my best ideas (e.g. Chinese equities) in my Share Dealing account.

[Guest OliverSmithIG]

Hi

 

Great to hear you have had success with your investments.

 

Smart Portfolios are not designed to eliminate your requirement to invest elsewhere - I also actively invest in shares through IG, but use an SP as a sensible diversifier against my own strategy going wrong.

 

When investing, I always try and ask myself whether I am being rewarded for the risk I take, whether performance was wholly down to skill, how correlated my investments will be in a downturn (e.g. EM, commodities and small cap can do poorly together), and how much of my return has come from currency risk (Smart Portfolios hedges a lot of this out).

 

We now have a year's track record, and returns have been very respectable vs. global indices, and with less risk.

https://www.ig.com/uk/investments/news/investing/2018/03/05/ig-smart-portfolios--one-year-track-record

 

The longer term BlackRock model portfolio returns have also done well against the UK wealth management peergroup.

https://www.ig.com/uk/investments/smart-portfolios/performance

 

Should add too, that (depending on how much you deal) £15k in a Smart Portfolio means you won't have to pay a £24/quarter custody fee on share dealing.

[Guest PandaFace]

thanks  - I didn't realise there was a 20 man team on it as well, and from Blackrock no less. Mental company. in 30 years they've got like 6 trillion .. TRILLION, with a T, assets under management. 

 

Imagine if you grew a company that big in 30 years :smileysurprised: :smileyvery-happy: