{"id":3906,"date":"2023-03-07T13:43:43","date_gmt":"2023-03-07T13:43:43","guid":{"rendered":"https:\/\/www.wealthtime.com\/advisers\/?post_type=blog&p=3906"},"modified":"2023-11-06T11:53:12","modified_gmt":"2023-11-06T11:53:12","slug":"why-with-profits-could-be-key-to-meeting-clients-appetite-for-risk","status":"publish","type":"blog","link":"https:\/\/www.wealthtime.com\/advisers\/blog\/why-with-profits-could-be-key-to-meeting-clients-appetite-for-risk\/","title":{"rendered":"Why With Profits could be key to meeting clients\u2019 appetite for risk"},"content":{"rendered":"\n

Nick Henshaw, Head of Intermediary Distribution at Wesleyan<\/em><\/p>\n\n\n\n

The perception of risk can be something that prevents people from taking even the first step on their investment journey. Many are put off by the understanding that they cannot control the risk. In fact, a recent Wesleyan poll of 2,000 Brits found that more than half (55%) said investing was just too risky for them. As every adviser knows, there is no risk-free financial decision, nor a risk-free investment pathway.<\/p>\n\n\n\n

But, as the sector demonstrates daily through its service and support, there are a myriad of ways to manage risk and tailor investment approaches to meet clients\u2019 specific needs.  Indeed, no advice can be considered suitable without it.<\/p>\n\n\n\n

Carefully crafted<\/strong><\/p>\n\n\n\n

When it comes to risk, then, advisers have a number of challenges and considerations.<\/p>\n\n\n\n

First, is helping assess appetite to risk \u2013 and its bedfellow, capacity for loss. Next is building a portfolio that will meet this appetite and deliver against clients\u2019 long-term objectives. And then there\u2019s adapting this portfolio to changes in clients\u2019 risk tolerance.<\/p>\n\n\n\n

Risk appetite cannot be considered a constant. It can, and most often will, evolve in line with a clients\u2019 circumstances, life stages and external market conditions. This is something that we\u2019ve seen recently following the past year\u2019s choppy economic waters.<\/p>\n\n\n\n

The same consumer research that highlighted people\u2019s aversion to risk also found that almost half (46%) of UK adults felt they were less likely to invest because of recent market turbulence \u2013 a clear indication of how volatility can affect investment appetite and how it needs to be actively managed.<\/p>\n\n\n\n

Strong foundations<\/strong><\/p>\n\n\n\n

Two ingredients are therefore desirable for any adviser looking to construct an effective, risk-balanced portfolio.<\/p>\n\n\n\n

They need strong, reliable performance. And they need the flexibility to scale up, or down, risk \u2013 in line with clients\u2019 changing appetite.<\/p>\n\n\n\n

With this in mind, it\u2019s easy to see the appeal of a smoothed With Profits fund that offers low volatility and a strong historic performance, as the foundation for a portfolio.<\/p>\n\n\n\n

Ultimately, this delivers returns, while unlocking all-important flexibility in how advisers construct the rest of clients\u2019 portfolios.<\/p>\n\n\n\n

Overall volatility can be reduced even further or increased elsewhere \u2013 with the With Profits fund as a baseline should clients want to dial-back volatility and risk in the future.<\/p>\n\n\n\n

A powerful tool<\/strong><\/p>\n\n\n\n

So, how does With Profits deliver these features?<\/p>\n\n\n\n

The low volatility is in part achieved through a mechanism that \u2018smooths out\u2019 fluctuations in market movements. This holds back some returns during times of strong performance and favourable market conditions, which can then be \u2018released\u2019 to cushion any fall during periods of weaker market performance.<\/p>\n\n\n\n

In the case of Wesleyan\u2019s With Profits Growth Fund Series A, this is done through a daily response to market movements, meaning the fund is daily priced, daily traded and daily smoothed, which avoids the need for sharper or unexpected corrections \u2013 ultimately delivering a less \u2018bumpy\u2019 investment journey.<\/p>\n\n\n\n

When it comes to returns, the performance of Wesleyan\u2019s With Profits Growth Fund Series A is supported by a high proportion of investments in real assets, which comprise approximately three-quarters of the fund\u2019s underlying investments. This has contributed to a cumulative return of 88% over the last decade*. The fund is actively managed by Wesleyan\u2019s award-winning Investments team, who focus on delivering capital growth without the pressure to deliver short-term gains.<\/p>\n\n\n\n

A powerful tool<\/strong><\/p>\n\n\n\n

Importantly, the fact that Wesleyan\u2019s smoothed With Profits Fund is available on platform means it is perfectly placed to enable this approach and can be included in both ISAs and SIPPs.<\/p>\n\n\n\n

As advisers prepare to support clients through what may be more choppy markets ahead, having this easy-to-access and powerful investment option on side will deliver all-important agility \u2013 while still supporting clients\u2019 goals.<\/p>\n\n\n\n

For more information on Wesleyan\u2019s smoothed With Profits Fund visit www.wesleyan.co.uk\/intermediaries<\/a>. Follow Wesleyan for Intermediaries<\/a> on LinkedIn.<\/p>\n\n\n\n

Please note that past performance is not a reliable guide to future performance and the value of investments, and any income can go down as well as up, so you could get back less than you invested.\u201d<\/em><\/p>\n\n\n\n

*Cumulative performance over 10 years of the Wesleyan With Profits Growth Fund Series A as at 31\/01\/2023.<\/em><\/p>\n\n\n\n

WESLEYAN is a trading name of the Wesleyan Group of companies. Wesleyan Assurance Society is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.<\/em><\/p>\n\n\n\n

Incorporated in England and Wales by Private Act of Parliament (No. ZC145).<\/em><\/p>\n\n\n\n

Registered Office: Colmore Circus, Birmingham B4 6AR. Telephone:0345 351 2352. Fax: 0121 200 2971. Calls may be recorded to help us provide, monitor and improve our services to you.<\/em><\/p>\n","protected":false},"author":5,"featured_media":3947,"template":"","class_list":["post-3906","blog","type-blog","status-publish","has-post-thumbnail","hentry"],"acf":[],"yoast_head":"\nWhy With Profits could be key to meeting clients\u2019 appetite for risk - Advisers<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.wealthtime.com\/advisers\/blog\/why-with-profits-could-be-key-to-meeting-clients-appetite-for-risk\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Why With Profits could be key to meeting clients\u2019 appetite for risk - Advisers\" \/>\n<meta property=\"og:description\" content=\"Nick Henshaw, Head of Intermediary Distribution at Wesleyan The perception of risk can be something that prevents people from taking even the first step on their investment journey. 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