Improving performance in our Active Multi-Asset Fund range
with Peter Smyth, Investment Director, Aviva Investors
Over the past few years, Aviva Investors has redefined its investment proposition in the Irish market. Within our Multi-Asset Fund range, we have introduced an enhanced range of funds built to suit the specific needs and requirements of differing investors. From our straightforward and easy-to-understand Fixed Allocation Fund range to our flagship Multi-Asset Active range, we have redefined our investment proposition, focusing on client needs and strongly emphasising improving customer performance outcomes.
Aviva Investors has been managing Multi-Asset portfolios for over 50 years. When you do something for this long, you learn a lot and continue to refine and improve your process. This heritage in Multi-Asset investing has enabled us to build a state-of-the-art investment process with a specific focus on risk management that delivers consistent returns for our clients.
Our flagship Multi-Asset ESG Active range currently manages €2.7bn in assets on behalf of Irish policyholders and provides investors with our best thoughts when it comes to Multi-Asset portfolio construction and active management1.
Following the launch of our Fixed Allocation and Passive Plus Multi-Asset ranges, it was important that we continued to refine, improve, and enhance our investment capabilities. In line with our annual review of our Multi-Asset Funds, we focused on some key areas to continue this evolution of our Active Multi-Asset Funds, with a specific focus on improving performance outcomes.
Making Active More Active
As part of the review in 2024, we added our market-leading Aviva High Yield Equity Fund to the equity content of our MAF Active Multi-Asset Fund range. The High Yield Equity Fund is recognised within the Irish market as a leading equity fund both versus peers and its benchmark, having outperformed its benchmark by over 2% per annum over the past 10 years2. This Fund now makes up 20% of the equity content of the Active Multi-Asset Fund range3. Keeping on the same theme, we added an active Sovereign Bond Fund with excellent long-term performance to complement our focus on making MAF Active more active.
Increased Equities
As part of our annual review, we also increased the Funds’ ability to add more equities while continuing to target specific volatility ranges. Coupled with this change, we also focused our active view of equities towards a global index, namely, the MSCI ACWI index, which meant that we also increased our weight towards US equities. On the other side of this reweighting was a reduction in our allocation to global high yield and emerging market debt, which we had historically viewed as providing equity-like returns but with lower volatility; this thesis had been challenged over the past few years with returns below our expectations, and as a result, we reduced our strategic weight to these asset classes.
More Conviction
When managing our active Multi-Asset Fund range, we take a dynamic approach to asset allocation, meaning that the portfolio manager will make short to medium term calls on the market based on our quantitative and qualitative research. As part of the MAF Active Funds annual review, we enhanced how we expressed our active calls while also appointing a new portfolio manager who continues to challenge the status quo and evolve how we implement our active decisions.
The Outcome – actions speak louder than words.
We implemented these enhancements following our review of the Active Multi-Asset Funds. This took effect from Q1 2024, and Aviva Investors’ key metric of success and focus has been improving performance within each Fund’s set risk tolerances. The changes that we made that have been detailed above have notably improved performance in 2024 versus our peers, with the Aviva MAF Active Fund becoming one of the best-performing Multi-Asset Funds in the market in 2024, especially in the medium and high-risk categories4.
We will continue to enhance and evolve our investment offerings as one of the leading managers of Multi-Asset Funds in the UK and Ireland. We clearly focus on risk management and performance, which is key for both brokers and their customers.
To learn more about our Star Performing Funds, visit www.avivabroker.ie/star-performers
For further information on our Multi-Asset ESG Range, visit our Multi-Asset Fund Range Hub
1. Source: Aviva Investors to 31 December 2024.
2.Source: Longboat Analytics. Based on gross fund performance to 31 December 2024
3.Source: Aviva Investors to 31 December 2024.
4.Source: LongBoat Analytics to 01 January 2025. Based on gross fund performance. Included in peer group are: Irish Life MAPS, Zurich Prisma, New Ireland iFunds, New Ireland Prime, LGIM. Standard Life, New Ireland Goodbody Dividend Income
Warnings
Warning: If you invest in this product you may lose some or all of the money you invest.
Warning: Past performance is not a reliable guide to future performance.
Warning: The value of your investment may go down as well as up.
Warning: These funds may be affected by changes in currency exchange rates.
Making Active More Active
As part of the review in 2024, we added our market-leading Aviva High Yield Equity Fund to the equity content of our MAF Active Multi-Asset Fund range. The High Yield Equity Fund is recognised within the Irish market as a leading equity fund both versus peers and its benchmark, having outperformed its benchmark by over 2% per annum over the past 10 years2. This Fund now makes up 20% of the equity content of the Active Multi-Asset Fund range3. Keeping on the same theme, we added an active Sovereign Bond Fund with excellent long-term performance to complement our focus on making MAF Active more active.
Increased Equities
As part of our annual review, we also increased the Funds’ ability to add more equities while continuing to target specific volatility ranges. Coupled with this change, we also focused our active view of equities towards a global index, namely, the MSCI ACWI index, which meant that we also increased our weight towards US equities. On the other side of this reweighting was a reduction in our allocation to global high yield and emerging market debt, which we had historically viewed as providing equity-like returns but with lower volatility; this thesis had been challenged over the past few years with returns below our expectations, and as a result, we reduced our strategic weight to these asset classes.
More Conviction
When managing our active Multi-Asset Fund range, we take a dynamic approach to asset allocation, meaning that the portfolio manager will make short to medium term calls on the market based on our quantitative and qualitative research. As part of the MAF Active Funds annual review, we enhanced how we expressed our active calls while also appointing a new portfolio manager who continues to challenge the status quo and evolve how we implement our active decisions.
The Outcome – actions speak louder than words.
We implemented these enhancements following our review of the Active Multi-Asset Funds. This took effect from Q1 2024, and Aviva Investors’ key metric of success and focus has been improving performance within each Fund’s set risk tolerances. The changes that we made that have been detailed above have notably improved performance in 2024 versus our peers, with the Aviva MAF Active Fund becoming one of the best-performing Multi-Asset Funds in the market in 2024, especially in the medium and high-risk categories4.
We will continue to enhance and evolve our investment offerings as one of the leading managers of Multi-Asset Funds in the UK and Ireland. We clearly focus on risk management and performance, which is key for both brokers and their customers.