Multi-Asset Strategies - Redefining the Universe

Mercer Insights


Multi-Asset Strategies - Redefining the Universe


Loved by many, reviled by others, multi-asset strategies are undeniably a key feature of the investment landscape. In the US they are typically known as balanced strategies; in Europe and other parts of the world investors have been enticed by a category of investments known as "diversified growth funds". Whatever the label, however, the variety of strategies is broadening across the globe.

We believe that this represents an opportune time to revisit the way we categorise the various strategies within the multi-asset universe.  We currently track over 300 strategies within the two major sub-categories of multi-asset investment (global balanced and diversified growth funds). 

We are redefining these product groups to better reflect the characteristics of the underlying strategies and the role that we believe that they could play in an investor’s portfolio.  In future, we will categorise these strategies in one of two ways:

•  Core Diversified Growth / Global Balanced
•  Idiosyncratic Diversified Growth

We also looked at the diversified beta universe; in this case we have elected to simply change the name to "Risk Parity" to better reflect the majority of strategies currently within that product grouping.

We believe that these categories will better able us to identify the most suitable products for our clients, as well as capture the broadening opportunity set we see emerging, particularly at the idiosyncratic end of the spectrum. 

 

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