LGIM launches diversified fund for long term savers
Investors in both defined contribution and defined benefit pension schemes are the target of a new diversified fund launched by Legal & General Investment Management (LGIM).
“The LGIM Diversified Fund aims to help pension fund investors who are looking for long-term growth in a fund designed to deliver less volatility than pure equity-only funds. The long-term expected annualised rate of return for the fund is broadly similar to that of a developed market equity fund, but the diversified nature of the fund means that it is expected to have less exposure than a pure equity fund to adverse equity market conditions,” the manager said.
Asset classes considered by the fund include:
– Developed market and emerging market equities
– Smaller company equities
– Private equity (via listed private equity companies)
– Developed market and emerging market government bonds (including inflation-linked)
– Corporate bonds (both investment grade and high yield)
– Direct property and real estate investment trusts
– Infrastructure (via listed infrastructure companies)
– Commodities (via the newly-launched LGIM Commodity Composite Fund, which gains its exposure using a blend of commodity derivatives
Most of the sub-funds that the fund will invest in are passive.
Long-term strategic asset allocation will typically be reviewed annually, for example, to ensure the fund incorporates any newly-available asset classes.
Because of its investment objectives, the fund will not take short-term tactical positions, meanign allocation is unlikely to change betweeen annual reviews.