Dynamic Real Return Fund

The Dynamic Real Return Fund is managed by Toby Nangle, Head of Multi-Asset Investments. It is an active, research driven multi-asset portfolio targeting equity-like returns with around two-thirds of equity volatility.

We believe that our robust investment process, our multi-disciplinary team with strong investment experience and a proven track record in asset allocation combined with our attitude to risk sets the Dynamic Real Return Fund apart from the competition.


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Important information
Source: Morningstar. Past performance is not a guide to future performance. The value of your investments and any income from them is not guaranteed and may go down as well as up. You may not get back full amount investment. Please be aware that Threadneedle does not offer investment advice. This tool allows the user to create and analyse fund performance over user defined periods which may be shorter than recommended. Please remember investing in funds should be seen as a medium to long term strategy. This tool is not suitable for use with retail investors. Fund performance compared against IMA peer group. The Investment Management Associated (IMA) is the trade body representing the UK investment management industry.

Fund Objective and Policy 

The aim of the Fund is to provide a positive real rate of return above inflation (defined as the Consumer Price Index) over the medium to long term and to provide a positive return over a three year time period, notwithstanding market conditions.

The Fund invests in shares of companies and bonds (which are similar to a loan and pay a fixed or variable interest rate) issued by companies and governments, money market instruments, cash, currencies, property and commodities worldwide. Commodities are physical materials such as oil, food and metals. The Fund makes active investment decisions and may vary exposure to or at times choose not to invest in some of the types of investments listed.

The Fund invests directly in these assets, through regulated or unregulated funds, or by using derivatives. Derivatives are sophisticated investment instruments linked to the rise and fall of the price of other assets.

Key selling points

  • Targeting positive real returns - the Fund targets CPI + 4% (gross of fees) over a three to five year investment horizon, in line with the long-run real return of equities.
  • Volatility-controlled approach - the Fund targets equity like returns with around two-thirds the volatility. Multi-asset investing can provide attractive positive returns whilst helping to keep volatility in check.
  • Global investment - long only, unleveraged investment approach across five broad asset classes - equities, fixed income, commodities, property, cash and alternative strategies.
  • Dynamic Allocation - timely shifts in asset allocation as risks and opportunities change and can vary significantly to reflect Threadneedle's asset allocation views.
  • Unconstrained and actively managed - the Fund will invest mainly in other Threadneedle funds but has the ability to invest in ETFs, Government Bonds and derivatives with no benchmark or asset allocation restrictions.
  • Experienced manager and team - managed by Toby Nangle who is supported by the experienced Threadneedle Multi-Asset team with access to the Asset Allocation team.

Key Risks

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. Market risk - The value of investments can fall as well as rise and investors might not get back the sum originally invested. Currency risk - Where investments are made in assets that are denominated in multiple currencies, changes in exchange rates may affect the value of the investments. Investor currency risk - Where investments in the fund are in currencies other than your own, changes in exchange rates may affect the value of your investments. No capital guarantee - Positive returns are not guaranteed and no form of capital protection applies. 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. 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. Valuation risk - The fund's assets may sometimes be difficult to value objectively and the actual value may not be recognised until assets are sold. Investment derivatives risk - The Investment Policy of the fund allows it to invest materially in derivatives. Volatility risk - The fund may exhibit significant price volatility.

Investment process

The Asset Allocation Strategy group uses the output from Threadneedle's three main research groups to formulate its macroeconomic and thematic views, and defines the investment environment used to build multi-asset portfolios. This is combined with a valuation framework across all asset classes, and is used by the group to determine its preferred asset allocation and risk preferences. The Multi-asset investment team is then responsible for portfolio construction within an overall risk budget, together with on-going risk monitoring to ensure a portfolio's investment returns are in line with pre-defined objectives.

Investment process overview

Dynamic Real Return Investment Process Overview

Risk Management

Our independent risk management team supports and enhances the portfolio manager's decision-making by conducting stress testing to evaluate the potential impact of extreme market shifts and identify sensitive market exposures. This is in addition to the team's own portfolio risk analysis, which includes pre and post trade compliance monitoring, stop-loss limits, portfolio modelling and mandate limit verification.  It is this rigour, underpinning the investment process that allows the team to invest with conviction.

  • Toby Nangle

    Toby Nangle

    Toby Nangle joined Threadneedle Investments as Head of Multi-Asset in 2012. In this role he is responsible for managing and co-managing a range of multi-asset portfolios, as well as providing strategic and tactical input to the Threadneedle asset allocation process.

    Before joining Threadneedle Toby worked at Baring Asset Management, initially in the fixed income team and subsequently as Director of the Multi-Asset Group. He holds degrees in History and International Relations from the University of Cambridge.

Fund Profile

View our Dynamic Real Return Fund Profile more >

Fund Application Form

View our Fund Application Form more >

Multi-asset brochure

View our multi-asset brochure more >

At a glance

Index
unconstrained
Launch date
Jun 2013
Fund size
-
Fund currency
GBP
OEICs
Current Price
15 Sep 2014
106.26 down -0.24
Fund Manager(s)
Toby Nangle
Download fund sheet

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