Views on Standard Life GARS fund

[HarryW]

Read loads on this recently as I'm not happy with my default company scheme relying on this as part of the blend down to less risky funds. For a fund that has a relatively low FE score it managed to lose money against a climbing equities market and 20% drop in the value of sterling. I read a comment to that effect on a SL advisors board that concluded, it's got to be pretty bad to drop money in that climate.

It seems to me the whole thing is a busted flush that rode on the wave of QE and now cannot perform, too many bad calls. Problem is; is it too big to fail or even for it to be called a failure for fear that it would rock the market?
Thoughts?

Edited by HarryW on Tuesday 27th June 20:24

[ellroy]

I think they lost some people to Aviva a while ago, running a similar approach over there.

[sidicks]

HarryW said:

Read loads on this recently as I'm not happy with my default company scheme relying on this as part of the blend down to less risky funds. For a fund that has a relatively low FE score it managed to lose money against a climbing equities market and 20% drop in the value of sterling.
I read a comment to that effect on a SL advisors board that concluded, it's got to be pretty bad to drop money in that climate.

Why is it surprising that in a rising equity market, a fund that invests across a range of different strategy to provide diversification benefits, and lower volatility / risk than equity markets, underperforms the equity market?

HarryW said:

It seems to me the whole thing is a busted flush that rode on the wave of QE and now cannot perform, too many bad calls. Problem is; is it too big to fail or even for it to be called a failure for fear that it would rock the market?
Thoughts?

Nonsense, it's just a diversified growth fund, designed to produce decent long-term returns without taking massive risk.

It depends on your risk appetite and time horizon, as to whether this fund is suitable for you.

In my opinion, there are probably better diversified growth funds out there (GARS is VERY big, which means it is less nimble than some smaller funds and it has lost it's key managers to competitors.

[Ginge R]

Haven't even thought about using it for years, have used it.. never.

https://www.pistonheads.com/gassing/topic.asp?h=0&...

[HarryW]

sidicks said:

HarryW said:

Read loads on this recently as I'm not happy with my default company scheme relying on this as part of the blend down to less risky funds. For a fund that has a relatively low FE score it managed to lose money against a climbing equities market and 20% drop in the value of sterling.
I read a comment to that effect on a SL advisors board that concluded, it's got to be pretty bad to drop money in that climate.

Why is it surprising that in a rising equity market, a fund that invests across a range of different strategy to provide diversification benefits, and lower volatility / risk than equity markets, underperforms the equity market?

HarryW said:

It seems to me the whole thing is a busted flush that rode on the wave of QE and now cannot perform, too many bad calls. Problem is; is it too big to fail or even for it to be called a failure for fear that it would rock the market?
Thoughts?

Nonsense, it's just a diversified growth fund, designed to produce decent long-term returns without taking massive risk.

It depends on your risk appetite and time horizon, as to whether this fund is suitable for you.

In my opinion, there are probably better diversified growth funds out there (GARS is VERY big, which means it is less nimble than some smaller funds and it has lost it's key managers to competitors.

Ok, that's the kind of response SL give out, problem I have with that is its not exactly impartial when they spout it. However I do fully get where you are coming from.

Since the migration of key players the fund has struggled, making more bad calls than good, aka negative Alpha. It purports to be something and everything, a balanced one stop shop with a combined overall lower risk. The problem being there seems to have been some very wild higher risk calls that have dragged the overall down. The problem I see is it so vast and diverse no one really understands the whole of it or can give a coherent answers how they are each linked as a single overriding strategy.
It does have an objective to exceed cash by +5% each year over a rolling 3 years, it has failed its own benchmark in that, which is worrying, blaming the market rather than their judgement and calls. I have no confidence in it, all I now see is smoke and mirrors, jargon for the sake of it and poor performance.

It's still a relatively recent fund 2008? and having have a proper dig around at some of the more independent assessments of the fund it seems it effectively matched the bond yield during QE years and now is floundering, something needs to change.

In my reading it has been interesting to see Old school advisors who cannot fathom why you just don't invest in a balance of funds and sectors reducing your risk to poor management (Alpha) of a single fund.

I'm interested in any views of anyone who has looked at this fund in any detail as opposed to reading the SL press releases.

[Ginge R]

Telling comment about so called 'Absolute Return' funds which were sold so heavily, in this morning's FCA AMMS report.

[sidicks]

HarryW said:

Ok, that's the kind of response SL give out, problem I have with that is its not exactly impartial when they spout it. However I do fully get where you are coming from.

Since the migration of key players the fund has struggled, making more bad calls than good, aka negative Alpha. It purports to be something and everything, a balanced one stop shop with a combined overall lower risk. The problem being there seems to have been some very wild higher risk calls that have dragged the overall down. The problem I see is it so vast and diverse no one really understands the whole of it or can give a coherent answers how they are each linked as a single overriding strategy.
It does have an objective to exceed cash by +5% each year over a rolling 3 years, it has failed its own benchmark in that, which is worrying, blaming the market rather than their judgement and calls. I have no confidence in it, all I now see is smoke and mirrors, jargon for the sake of it and poor performance.

It's still a relatively recent fund 2008? and having have a proper dig around at some of the more independent assessments of the fund it seems it effectively matched the bond yield during QE years and now is floundering, something needs to change.

In my reading it has been interesting to see Old school advisors who cannot fathom why you just don't invest in a balance of funds and sectors reducing your risk to poor management (Alpha) of a single fund.

That is certainly an option, but clearly the market environment will change over time, so a static allocation to different asset classes is unlikely to lead to the best returns (or the lowest risk).

I'd also argue that a professional fund manager is much better placed to make that asset allocation call than your typical 'man on the street' or 'High street 'IFA'.

The obvious way of mitigating these risks is to invests in a range of DGFs!

HarryW said:

I'm interested in any views of anyone who has looked at this fund in any detail as opposed to reading the SL press releases.

I am reasonably familiar with the fund and other DGFs. However, although they often have similar objectives, the approach to achieving those objectives can differ substantially.