Hartford, CT-based Phoenix Investment Partners has launched two new diversified asset allocation mutual funds modelled after institutional portfolios which include alternative investment strategies to moderate volatility and enhance return potential.
The Phoenix Partner Select Wealth Builder and Wealth Guardian Funds include fixed allocations to seven Phoenix mutual funds employing both traditional and alternative investment strategies and carry a low minimum investment level of $500.
The underlying funds are the same in each Partner Select Fund, but the allocations between the bond and equity components vary slightly to fit each fund's objective.
Wealth Builder, a capital appreciation fund, has an 80/20 allocation to equities and bonds. Wealth Guardian, a current income and capital appreciation fund, maintains a 60/40 allocation to equities and bonds.
Both funds feature a 15 per cent exposure to alternative investments in the equity component: 10 per cent in real estate securities and 5 per cent in a market neutral (long/short) strategy.
John F. Sharry, president, private client group, Phoenix Investment Partners, is responsible for distributing the new Partner Select Funds. He said: "This is a new breed of allocation fund that is built like an institutional portfolio to include alternative asset classes in addition to traditional stocks and bonds. We've taken a page from institutions, such as public pensions and endowments, and are using alternatives that may help moderate portfolio volatility because of their low correlation to traditional asset classes. This also increases the potential for stronger performance."
"Trying to time the market seldom works in investors' favour - it's better to be diversified and stay put, and institutions are much more disciplined than individuals when it comes to setting up, and sticking to, an allocation strategy," said Sharry.
He added: "The diversification and rebalancing features of the Partner Select Funds act as guardrails to help keep investors on the road to their long-term goals. Allocation funds produce a blended return of the underlying strategies, which can deter investors from abandoning one strategy to chase the performance of another, only to lose."
The seven underlying strategies within each Partner Select Fund are managed by six of Phoenix's independent investment managers. "We chose funds that demonstrated lower portfolio risk as well as consistency in performance and investment style," said Sharry.
Christopher Wilkos, senior vice president, corporate portfolio management, The Phoenix Companies, is the overlay manager of the Partner Select Funds. Mr. Wilkos and his team are responsible for monitoring the underlying fund managers, maintaining the allocations of each underlying strategy, and rebalancing as needed. Mr. Wilkos, CFA, currently manages over $16 billion in pension and general account assets for The Phoenix Companies.
The equity components of the Partner Select Funds are managed by Kayne Anderson Rudnick Investment Management and Oakhurst Asset Managers. The bond portions are managed by Seneca Capital Management and Goodwin Capital Advisors. The real estate portfolios are managed by Duff & Phelps Investment Management Co. and the market neutral portfolios are managed by Euclid Advisors LLC.
The Partner Select funds are available in A and C share classes.
Background Note: Phoenix Investment Partners, Ltd. is the wholly owned asset management subsidiary of The Phoenix Companies, Inc., with $56.5 billion under management as of June 30, 2003. Phoenix Investment Partners provides individuals and institutions with disciplined money management through eleven investment affiliates, and offers managed accounts, mutual funds, closed-end funds, alternative financial products, and institutional management services.
Copyright Hedgeweek 2003