Copia Capital Management [Copia] has launched the Copia Select: Retirement Income portfolios, to provide greater choice for investors in decumulation.
Comprising five risk-rated portfolios, the new range is designed to address the key decumulation risks, recognising that those taking an income from their investments face very different risks to those still building their wealth.
The Retirement Income range is the second set of decumulation-specific portfolios launched by Copia this year. It follows the introduction of the Retirement Income Plus portfolios in May, which use annuities as an asset class to provide greater certainty of outcome in retirement.
While both decumulation ranges aim to mitigate the key decumulation risks and help advisers meet the new Consumer Duty rule to “avoid causing foreseeable harm”, their distinct investment approaches offer advisers and their clients greater choice over how to achieve their retirement income goals.
The new retirement income portfolios are built using an asset allocation that addresses the needs of retirement investors and the risks faced while drawing down an income. The portfolios follow a similar quantitative methodology to Copia’s highly successful accumulation models, but a greater proportion is allocated to less traditional assets which provide a diversified alternative exposure, such as hedge funds, infrastructure, real estate and commodities.
These alternative assets typically have lower correlation to equity and fixed income, offering investors greater protection against the impact of taking an income during unfavourable market conditions than a typical accumulation portfolio.
Robert Vaudry, Managing Director of Copia, says, “We firmly believe in the need to take a distinct approach to investing for decumulation versus accumulation. We also recognise that there are different ways to optimise asset allocation to maximise returns for investors while mitigating the specific risks associated with taking an income from investments.
“With the Financial Conduct Authority’s thematic review of retirement income advice putting a spotlight on decumulation, our two distinct retirement income ranges now offer advisers greater choice over the investment approach they can take to meet the different needs of clients at or in retirement.”
The Retirement Income Plus portfolios, which use Just Group’s Secure Lifetime Income (SLI) for the annuity component, are now available on the 7IM platform, as well as the Novia platform, broadening access to this innovative product to more advisers and their clients. The new Retirement Income portfolios are available across 17 fund management platforms.
