Meeting With Katie Trowsdale

We find ourselves in uncertain times again and the news coming out of Ukraine is heart breaking.

I wanted to write to help explain what the current challenges mean for your investments, how your money is invested and what we should be doing.

 

Yesterday, I was lucky enough to meet with Katie Trowsdale, Head of Multi-Manager Strategies at abrdn (Standard Life), and Jeremy Lawson, Chief Economist and Head of the abrdn Research Institute, at their offices in Bread Street, London. These are the very people that decide where our money is invested and I had them all to myself for a couple of hours . Katie oversees all the MyFolio Portfolios that we recommend and although markets are volatile, I left as confident as ever that abrdn and MyFolio have a robust strategy to navigate these uncertain times.  

STRATEGIC ASSET ALLOCATION (SAA):

Firstly they use a committee of 8 Investment Professionals, containing some of the world’s best economists and analysts, to provide their Strategic Asset Allocation process. They look at where in the world we should be invested and at what level. They take into account political as well as economic and industrial information. In other words, they chose the right mix of investments and where in the global economies some of your money should be invested, as well as the percentage of the portfolio that should be invested there.

TACTICAL ASSET ALLOCATION (TAA):

This team take the information from the SAA and drill down further. They are made up of 25 Investment Professionals and members of the Global Strategy and ABRDN Research Institute, plus the 34 member strong Multi-Asset and Risk Group. They look at which asset classes to favour over the short term for each fund.

FUND SELECTION AND PORTFOLIO CONSTRUCTION:

Once each Portfolio knows where to invest and at what level, they will research and find the best funds for that global region or sector. For example, if the SAA/TAA’s brief is for 17.4% to be invested in the UK, the teams will look at a number of funds in the UK to invest in. They will look for diversity to reduce the risk of not having ‘all their eggs in one basket’, like energy or financials etc. The SAA will provide a long term view and be the basis for the initial fund choices. The TAA will act at times of sudden change, like the COVID-19 Pandemic and the Russia/Ukraine conflict.

REVIEW AND REBALANCE:

The last stage is to constantly review and rebalance. Rebalancing is important to keep the Portfolio within it’s risk rating. If a sector does extremely well, they will look to sell some of that asset and rebalance the portfolio accordingly.

 

Please see above a great video by a YouTuber I follow called Pete Matthews. Pete is a Financial Adviser like me and puts things perfectly in this short video.

As per my previous email, I still feel the best thing to do currently is nothing, as hard as it may be.  I constantly monitor the situation and will update you as and when I feel necessary.  On the second Friday of every month, we have scheduled meetings to look at macro and micro economics to ensure we stay on top of things.  The more informed we all are, the better.

 

 

get-in-touch

 

(01202) 757136

office@firstgroupuk.com

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