For the first time in its long history, Wesleyan Assurance Society has made its flagship With Profits Fund available to Independent Financial Advisers. The Fund was previously only directly accessible online or through Wesleyan Financial Service’s direct advice team. In this article we explain more about the Fund and how it could benefit your customers.
A fund for ‘moderate risk’ investors
Our With Profits Fund is a great addition for anyone advising customers with a moderate risk appetite. It’s a multi-asset fund with a portfolio that typically has up to 65% allocated to UK and overseas equities, with the remainder mostly consisting of fixed interest, property and cash. The Fund’s property holdings cover a range of different assets located throughout the UK, including offices, industrial units, retail shops and other specialist buildings such as farms, restaurants, bars and hotels.
Wesleyan has a long-standing strategy of maintaining high levels of equity exposure within the Fund as we believe this offers the best potential for long-term competitive returns. This is evidenced by its cumulative 10-year return of 130%*.
Underpinned with financial strength
We are able to retain this high level of equity exposure because we are a capitally strong organisation. This, combined with the fact that we are a mutual with no shareholders to consider, means that we can boost investors’ returns through the distribution of surplus capital.
Smoothing the journey
With profits investments may be particularly suited to those investors who like to see a more consistent return over time as they employ a process called smoothing which reduces the impact of market volatility. This means some of the fund’s returns are held back during times of strong performance and favourable market conditions and then ‘released’ as a cushion during periods of weaker market and fund performance.
Wesleyan’s smoothing formula is designed to smooth out fluctuations in the asset value and respond quickly to large market movements. This avoids the need for sharp or unexpected corrections, which can be more commonplace elsewhere in the With Profits marketplace. In volatile markets, Wesleyan’s smoothing process essentially accelerates, helping return the Fund closer to its fair value.
Wesleyan’s With Profits Fund has a simple, transparent structure. Thanks to daily unit pricing, investors can track how the fund is performing and how much their investment is worth on any given day. Importantly, there will be no market value reductions applied, which can be complicated mechanisms to explain to your clients.
Strong management
Our With Profits Fund is managed by Marc O’Sullivan, who has almost 20 years’ industry experience. Marc is supported in his work by the in-house Investments team at Wesleyan, which includes its experienced Fund Managers, Property Managers, Investment Analysts and a Socially Responsible Investment team. It’s worth noting that all of Wesleyan’s directly managed funds adhere to our own sustainable principles designed to avoid harm, have a positive impact and drive change.
As ‘active managers’, the Investments team look to outperform the market over time, using periods of market volatility – as seen recently – to invest in companies and assets they believe have been overlooked and undervalued by the market. Their long-term track record speaks for itself – take a look at the latest With Profits Fund fact sheets.
*Wesleyan With Profits Growth Fund – Series A Fund Factsheet
The value of investments and any income can go down as well as up. Investors may get back less than they invest.