Financial intermediaries
Mercer’s approach to Managed Portfolios
Rebecca Jacques, Head of Wealth Management Investment Solutions, provides an overview on how Mercer constructs our managed account portfolios and what advisers…
Managed accounts
Mercer is pleased to partner with Colonial First State (CFS) to offer investors a range of purpose-built solutions through their CFS Edge managed accounts Accelerate 100 portfolios offering.
The Mercer managed account advantage
With over 20 years’ experience, advisers benefit from Mercer’s comprehensive and proven capability of managing diversified managed accounts.
We offer a broad range of managed account options, including Licensee Tailored portfolios, Active and Passive Multi-Sector managed portfolios, Retirement portfolios and unique portfolio solutions offered via an insurance bond platform.
In accordance with our investment governance and compliance framework, we offer flexibility over portfolio design and manager selection according to individual preferences.
Mercer’s specialist Portfolio Solutions team on the ground in Australia leverages both our local expertise and our global intellectual capital to deliver optimal investor solutions and outcomes.
The combination of the vast resources of the global Mercer research team and the unique portfolio construction and management our investment team delivers, advisers can tailor solutions specific to client requirements. In addition, our global scale is used to negotiate fees with our managers to reduce costs for our clients within the managed portfolios.
How Mercer builds portfolios
At Mercer, we understand that constructing portfolios and developing successful investment strategies requires a strong and well-defined investment philosophy at the forefront of our approach.
Mercer’s investment philosophy
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Client objectives
- Investment success is dependent on clearly defined investment goals.
- An investor’s true risk is not being able to meet their primary portfolio objective.
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Strong governance
- Robust and high-quality governance processes are essential for successful investment outcomes.
- Strong governance is necessary in times of crisis.
- Establishing clear accountability for results promotes disciplined decision-making and risk-taking.
- Effective stewardship can improve investment outcomes.
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Rewarded risk
- Asset allocation is the most important decision and is the primary driver of risk and return outcomes.
- Risk and return are related, but the relationship can vary over time.
- It is important to understand how risks interact.
- Portfolio resilience can be enhanced by integrating financially material sustainability, transition and socio-economic risks into investment decision-making.
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Maximize value
- Strategic asset allocation is the most significant determinant of value creation.
- Active management can be employed where expected return benefits justify risks and fees.
- Private markets can offer certain advantages over public markets for long-term investors.
- Dynamic asset allocation, if implemented can add value to investment strategies.
- Investing to solve long-term systemic issues may provide opportunities to improve risk-adjusted returns.
Building portfolios – a clear and robust process with the investment philosophy front of mind
Our portfolio construction process begins with our investment philosophy. This philosophy guides our long-term Strategic Asset Allocation (SAA), incorporates Dynamic Asset Allocation (DAA) when appropriate, and includes manager/strategy selection, portfolio construction, and ongoing reviews/monitoring to help drive investment success for our clients.
- Strategic asset allocation – set every 3 years and reviewed annually
- Dynamic asset allocation – updated quarterly
- Manager/strategy selection – continual review and update
- Portfolio construction – updated annually
- Final portfolios – include platform and fees
- Reporting & Monitoring – provided in monthly, quarterly and annual cycle’s
See our important notices and product information for the Mercer Financial Service Guide, fact sheets, Product Disclosure Statements and performance information.
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