INFORMATION FOR INVESTMENT PROFESSIONALS
THREADNEEDLE
MANAGED FUNDS
Threadneedle managed fund range
The Threadneedle managed funds are fettered fund of fund, multi asset portfolios that invest in a range of asset
classes including equities, cash and bonds. They seek to provide long-term capital growth and/or income while
benefiting from a reduction in absolute volatility through diversification.
The funds allow investors access to relatively low cost, well-diversified portfolios, with the benefit of our highly skilled
Multi Asset team constantly monitoring market conditions and making tactical changes to the portfolios’ exposure to
different assets through the economic cycle.
Spanning the risk/return spectrum
The funds in our managed fund range use suitable blends of asset classes to cater for different attitudes to risk.
Investors can choose between a very cautious, risk averse fund to a much riskier fund with higher potential returns,
or somewhere in the middle.
Higher
Managed
Equity Fund
Potential return
Managed Equity
Focused Fund
Managed Equity
& Bond Fund
Managed
Bond Fund
Lower
Managed Bond
Focused Fund
Potential risk
Source: Columbia Threadneedle Investments. For illustrative purposes only. Please note that returns are not guaranteed.
Key reasons to invest
nn
Diversified – The funds invest in a blend of assets including equities, cash and bonds, seeking
to exploit the benefits of low correlated asset classes
nn
Global perspective advantage – Columbia Threadneedle’s investment philosophy and process are built
upon the sharing and debating of ideas and collaboration across teams and sectors
nn
Daily risk management – Investing in our own funds allows complete look-through risk analysis on
positions held within constituent funds and enables us to monitor risk on a daily basis
nn
Long heritage in multi asset – Multi asset has been a key part of our business for over 20 years.
The Multi Asset EMEA team manage £46.8bn, representing 29% of our total AuM*
Source: Columbia Threadneedle Investments EMEA as at 31.01.2017. Value represents 29% of Columbia Threadneedle Investments, EMEA total AuM.
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Higher
Managing risk through the market cycle
The funds take an active, research-driven approach, aiming to blend the optimal mix of investments to deliver
targeted returns. The chart below shows the effect of the global financial crisis on the fund range. Here we can
see that the more defensive the fund, the lower the volatility of returns, while the more equity-heavy, aggressive
funds saw a sharper drop in value and subsequent recovery.
Threadneedle Managed Funds
100
Managed Equity Fund
90
Managed Equity Focused Fund
Risk
80
Net Cumulative Return (%)
Dynamic Planning (DP) risk ratings:
Managed Equity & Bond Fund
70
Managed Bond Focused Fund
60
Managed Bond Fund
50
40
30
20
10
0
-10
-20
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: Morningstar and Columbia Threadneedle Investments. All data at 31.01.2017. Returns net of fees in GBP. Past performance is not a guide to future performance.
Investment philosophy and process
Investment philosophy
The investment philosophy is summarised as follows:
nnActive management of managed portfolios can deliver positive returns over the longer term.
nnWe seek to exploit active return sources at both the asset allocation and fund selection levels.
nnOur focus on proprietary funds enhances portfolio oversight as part of a disciplined risk management.
Investment process
We seek to exploit active return sources at both the asset allocation and stock/fund selection levels.
Our managed funds use a three-stage process outlined in the chart below:
Economic Research Group –
what is going to happen?
Valuation Research Group –
what is in the price
Sector & Thematic Research Group –
create investment themes
Identify investment regime
Identify asset preferences
Identify our key differentiators
to the consensus
Set current risk tolerance levels
Source: Columbia Threadneedle Investments. For illustrative purposes only.
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Implement mainly via internal funds
Full look-through bottom-up
risk analysis ex post
Key characteristics
Managed
Bond Fund
Managed Bond
Focused Fund
Managed Equity
& Bond Fund
Managed Equity
Focused Fund
Managed
Equity Fund
IA sector
Mixed Investments
0-35% shares
Mixed Investments
0-35% shares
Mixed Investments
20-60% shares
Mixed Investments
40-85% shares
Flexible Managed
Equity %
19%
33%
51%
71%
81%
Percent of total holdings
UK Equities
UK Bonds
Overseas Equities
Overseas Bonds
Cash
Alternatives
Dispersion of returns
Rolling 12 month performance
30%
20%
10%
0%
-10%
-20%
-30%
3
4
5
6
7
Sept 2002
Sept 2002
August 1997
August 1997
August 1997
Fund Manager(s)
Alex Lyle
Alex Lyle
Alex Lyle &
Mark Burgess
Alex Lyle &
Mark Burgess
Alex Lyle &
Mark Burgess
Fund size
£249m
£340m
£1,350m
£736m
£360m
AMC
0.55%
0.65%
0.65%
0.85%
0.90%
OCF* (at 15.05.2016)
0.71%
0.77%
0.83%
0.99%
1.06%
DP risk profile
Launch date
Ratings
Source: Columbia Threadneedle Investments as at 31.01.2017, unless otherwise specified. Calendar year returns are net of fees and in GBP. Past performance is not a guide to future
performance. Where references are made to portfolio guidelines and features, these may be subject to change over time and prevailing market conditions. Actual investment parameters
will be agreed and set out in the prospectus or formal investment management agreement. *The ongoing charges figure (OCF) is based on the last year’s expenses for the Z Net Accumulation
Share Class and may vary from year to year. It includes charges such as the fund’s annual management charge, registration fee, custody fees and distribution cost but excludes the costs of
buying or selling assets for the Fund (unless these assets are shares of another fund). For a more detailed breakdown please visit www.columbiathreadneedle.com/fees
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Key risks and objectives
Managed
Bond Fund
Managed Bond
Focused Fund
Managed Equity
& Bond Fund
Managed Equity
Focused Fund
Managed
Equity Fund
The aim of the
Fund is to provide
income with the
potential to grow
the amount you
invested as well
The aim of the
Fund is to provide
income with the
potential to grow
the amount you
invested as well
The aim of the
Fund is to grow
the amount you
invested and
provide income
as well
The aim of the
Fund is to provide
income with the
potential to grow
the amount you
invested as well
The aim of the
Fund is to grow
the amount you
invested Investment risk: The value of investments can fall as
well as rise and investors might not get back the sum
originally invested.
3
3
3
3
3
Investment in funds: The Investment Policy allows the fund
to invest principally in units of other collective investment
schemes. Investors should consider the investment policy
and asset composition in the underlying funds when
assessing their portfolio exposure.
3
3
3
3
3
Currency risk: Where investments are in assets that are
denominated in multiple currencies, or currencies other than
your own, changes in exchange rates may affect the value of
the investments.
3
3
3
3
3
Issuer risk: The fund invests in securities whose value would
be significantly affected if the issuer either refused to pay or
was unable to pay or perceived to be unable to pay.
3
3
3
3
Inflation risk: Most bond and cash funds offer limited
capital growth potential and an income that is not linked
to inflation. Inflation is likely to affect the value of capital
and income over time.
3
3
3
3
Interest rate risk: Changes in interest rates are likely
to affect the fund’s value. In general, as interest rates rise,
the price of a fixed rate bond will fall, and vice versa.
3
3
3
3
Derivatives for EPM/hedging: The investment policy of
the fund allows it to invest in derivatives for the purposes
of reducing risk or minimising the cost of transactions.
3
3
3
3
3
3
3
3
3
3
3
Objectives
Volatility risk: The fund may exhibit significant price volatility.
High volatility risk: The fund typically carries a risk of high
volatility due to its portfolio composition or the portfolio
management techniques used. This means that the
fund’s value is likely to fall and rise more frequently and
pronounced than with other funds.
Effect of dual pricing: The fund is dual priced and there
is a difference between the buying price and the selling
price of units.
3
3
3
To find out more visit columbiathreadneedle.co.uk
Important information: Past performance is not a guide to future performance. The value of investments and any income is not guaranteed and can go down as well as up and may be affected by exchange rate fluctuations. This means that an
investor may not get back the amount invested. The Threadneedle Managed Funds range consists of six unit trusts: the Threadneedle Managed Equity Fund, Threadneedle Managed Equity Focused Fund, Threadneedle Managed Equity & Bond
Fund, Threadneedle Managed Bond Focused Fund, Threadneedle Managed Bond Fund and Threadneedle Managed Income Fund (together ‘the Trusts’). The Trusts are Authorised Unit Trust Schemes within Section 243 of the Financial Services and
Markets Act 2000 and are constituted pursuant to the Financial Conduct Authority’s Collective Investment Schemes Sourcebook (COLL), as amended from time to time. The Trusts are UCITS schemes for the purpose of COLL. This material is for
information only and does not constitute an offer or solicitation of an order to buy or sell any securities or other financial instruments, or to provide investment advice or services. The fund characteristics described above are internal guidelines
(rather than limits and controls). They do not form part of the fund’s objective and policy and are subject to change without notice in the future. The research and analysis included in this document has been produced by Columbia Threadneedle
Investments for its own investment management activities, may have been acted upon prior to publication and is made available here incidentally. Any opinions expressed are made as at the date of publication but are subject to change without
notice and should not be seen as investment advice. Information obtained from external sources is believed to be reliable but its accuracy or completeness cannot be guaranteed. This presentation and its contents are confidential and proprietary.
The information provided in this presentation is for the sole use of those attending the presentation. It may not be reproduced in any form or passed on to any third party without the express written permission of Threadneedle Investments.
This presentation is the property of Columbia Threadneedle Investments and must be returned upon request. Issued by Threadneedle Investment Services Limited. Registered in England and Wales, Registered No. 3701768, Cannon Place,
78 Cannon Street, London EC4N 6AG, United Kingdom. Authorised and regulated in the UK by the Financial Conduct Authority. Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.
columbiathreadneedle.com
Issued 03.17 | Valid to 08.17 | J26255
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