Aviva is marking the first anniversary of the launch of its Governed Portfolios range of funds, managed by Morningstar, by launching a new portfolio within the range.
The new portfolio is suitable for advisers who are looking to offer income solutions as part of a client’s investment strategy, rather than just growth. This can support the investment objective of capital preservation, which is an increasingly important demand advisers are responding to from their clients.
The range offers primarily passive funds, but active funds are also available. By offering primarily passive funds, costs can remain low.
Tim Orton, CEO Aviva Adviser Platform, says,
“I’m delighted with the success of the range in the year since launch. The range was created on the back of adviser demand for access to Discretionary Fund Management at a wider range of price points. The take-up we’ve seen shows that it meets a real need in the market. This is now the fastest growing range of models on the Aviva Platform, and we’re seeing over 100 new clients investing each month.
“As always, we continually review our funds to make sure they’re meeting adviser demand, and this is the driver behind the launch of the additional fund in the range. Managing income is increasingly important to advisers and clients and the additional fund provides an option to meet this need.”
Dan Kemp, CIO Morningstar Investment Management Europe Ltd, says,
“We are delighted to be working with Aviva to create this income portfolio for the Governed Portfolios range available on the Aviva platform.
“The Governed Income Portfolio is specifically designed to meet the needs of retiring investors seeking a sustainable income. In a low interest rate world, investment costs can act as a significant drag on returns, and the Governed Income portfolio has been designed to minimise these costs while benefiting from Morningstar’s fund selection expertise.
“We minimise costs by applying a simple fee cap of 60 bps. This cap, which includes both the underlying fund charges and Morningstar’s fee of 0.15%, ensures that the portfolio managers carefully consider every basis point spent on fees.
“In common with all of Morningstar’s managed portfolios, the Governed Income portfolio is aligned to our risk tolerance questionnaire, helping advisers find the right portfolio for their clients.”
Since the introduction of the Governed Portfolios range in May 2016, the portfolios have become increasingly popular with advisers who are looking for a low cost option to offer Discretionary Fund Management for clients.
Aviva wanted to offer a portfolio for advisers who were looking to outsource their investment discretion to a range with governance. We were pleased to be able to work with Morningstar’s investment management team to create a solution for advisers in this market.
Aviva gave Morningstar a portfolio specification to build a range of low-cost managed portfolios for advisers using the Aviva platform, and meeting five criteria :
- Produce a range of five risk-based multi-asset portfolios
- Give coverage of the risk spectrum from cautious to adventurous
- Use the range of assets available on the Aviva platform
- Make them accessible for GIA, ISA and SIPP products, through the Aviva Platform
- Cap the cost at 0.5% ongoing charge figure (this includes the cost of investments, the managed portfolio cost and any associated VAT, but not the adviser charge).
More information about the wider range of investments solutions available through Aviva Platform can be found at www.aviva-for-advisers.co.uk
You can find out how Morningstar built these portfolios by contacting them at governedportfolios@morningstar.com
ENDS
Enquiries:
Media: Catherine Comben, Aviva UK Media Relations Manager 01904 453394 M: 07800 692087 E: Catherine.comben@aviva.com
Notes to editors:
- Aviva provides life insurance, general insurance, health insurance and asset management to 33 million customers, across 16 markets worldwide
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