HDA Blended Strategies
When it comes to investing for growth most investors are prepared to accept a degree of risk but many also want to feel that their capital is safe from the extremes of the markets. If your investment horizons are long-term you do not need to be too concerned about short-term volatility. In fact, it is to be encouraged because the investments that deliver the highest long-term returns are usually the most volatile in the short-term. But as timeframes shorten and your need for capital security increases it is important to achieve the correct balance between risk and reward.
HDA offers a range of investment strategies which may be “blended” together to suit an investor’s individual needs and requirements:
The HDA Growth Portfolio aims to provide long-term capital growth from a broad range of UK and global equity funds (“stocks and shares”).
The HDA Absolute Return Portfolio aims to provide a positive return in all market conditions. To achieve this aim the portfolio will invest primarily in cash, fixed-interest securities and absolute return strategies. The portfolio may also invest directly into commercial property and equities but direct exposure to these asset classes will be low. An income version is available as well as a growth version of this portfolio.
We are very conscious of the increasing correlation of equities and bonds, i.e. supposedly lower risk investments exhibiting similar behaviour to higher risk investments at the same time. It is happening now in 2015/16 and it certainly happened in 2007/8 as the global financial crisis wiped gazillions of the value of global markets. We are extremely careful, therefore, to ensure that we hold genuinely market neutral assets in our Absolute Return portfolio.
Both strategies aim to produce superior performance through careful management of risk. By blending these portfolios together in different proportions we can offer targeted returns with greater or lesser control of volatility to suit each investor’s individual requirements.
The HDA Blended Growth Strategies allow you to control exactly how much of your capital is directly exposed to the stock market and how much is invested with the primary aim of preserving capital. This careful control of risk allows you to plan ahead with confidence with a clear understanding of likely long-term returns and short-term volatility.
In early 2015 we introduced a Dynamic version of our Blended Strategies which will automatically increase or decrease exposure to global stock markets on a monthly basis. In February 2016 we are introducing an Adaptive Equity core to our portfolios which has the ability to increase and decrease risk on a daily basis. Please refer to our Dynamic & Adaptive page for more information.