"So to us our goalkeepers are our multi-asset stars - nothing complicated like derivatives or leveraged ETFs. Long-only commonsense, using non-correlated fairly or undervalued sectors.
"That is why we especially like Mr Lyon at Troy who we've backed for over 10 years, and David Jane at Miton who we’ve backed since his days as CIO at M&G when he launched their Cautious Multi Asset fund with his mum in mind.
"And with gilts and treasuries such poor value, and half of world’s long bonds in negative yields, bond funds as defenders don’t make any sense. It is an even bigger Bubble waiting to burst than the Dotcom one.
"But like all other sectors, quality of manager is sacrosanct, so multi-asset has its place for sure. However, if it’s popular now, with billions flowing in, that’s also a good sign for equity optimists."
Business as usual
For many fund managers, the fears stalking some people's minds is simply business as usual. Alan Dick, director of Glasgow-based Forty Two Financial Planning, said: "Volatility in what's happening today is irrelevant. The world is always volatile – there's always things going on that we could be worried about. I think we should be worried about volatility as a default position, not just what's happening now."
Mr Dick is a firm believer in multi-asset investing, but prefers to diversify using his own judgement rather than through the decision-making process of a fund manager. He said: "We are almost 100 per cent 'systematic' investing; we use index trackers and asset class funds like Dimensional. That is pure multi-asset investing. We have a fund that just follows the return of the FTSE, the FTSE World Index and emerging markets.
"We're using an asset mix rather than pay a fund manager to choose a fund. We don't believe anybody has a crystal ball to let you see the future. We prefer someone to have a sustainable risk profile on asset allocation."
As a fundamental of investment theory, diversification through multi-asset investing is a popular choice, whether through self-selecting decisions made by the adviser, or through outsourcing those decisions through a multi-asset fund.
Melanie Tringham is features editor of Financial Adviser
