How multi-asset funds use investment trusts
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CT MM Navigator Distribution
The team behind this fund aims to deliver investors a high and reliable income, with the potential for capital growth. CT MM Navigator Distribution is a multi-manager, multi-asset portfolio, which generally contains between 25 and 35 individual funds, balancing diversification, and risk. The team is targeting a yield that puts the fund in the top 10% of income generators in its sector. This income is distributed on a quarterly basis.
Previously BMO MM Navigator Distribution
Our opinion
Following the retirement of Gary Potter, the nine-strong team is now solely headed up by the highly experienced Rob Burdett. The CT MM Navigator Distribution fund has consistently delivered a high income with capital appreciation. The team’s ability to find less well-known funds and then blend them together makes this a very interesting fund for income seekers.
Company description
Columbia Threadneedle Investments is a leading global asset management company, owned by the US financial services firm, Ameriprise Financial (NYSE: AMP). It offers a broad range of actively managed investment strategies and solutions covering global, regional and domestic markets and asset classes. These include equities, fixed income, multi-asset and alternatives, as well as specialist responsible investment capabilities and a comprehensive suite of solutions. The firm has an international presence spanning 19 countries across the UK, Europe, US and Asia. Following the acquisition of BMO Global Asset Management (EMEA) by Ameriprise Financial in 2021, and the integration of BMO GAM into Columbia Threadneedle Investments, all BMO and Threadneedle funds were renamed with the ‘CT’ naming convention in July 2022.
Fund manager
Rob Burdett is head of the nine-strong multi-manager team. Alongside the recently retired Gary Potter, Rob was one of the early pioneers of multi-manager/fund of fund investing, with the pair having worked together since 1996, amassing an impressive track record first at Rothschild Asset Management and then at Credit Suisse Asset Management, before establishing Thames River Multi-Capital LLP (a joint venture with then parent Thames River Capital LLP) in August 2007. While Gary is retired, he will remain involved as a consultant on the entire fund range.
The key to our process is our team, who have stayed together through three different businesses - some of us have never worked with anyone else! - and the average tenure is longer than the average marriage.
Rob BurdettFund manager
Investment process
The team believes it can only stay successful if it operates under a set of guiding principles and not rules, allowing it to adapt the portfolio through investment cycles. A proprietary fund manager scoring system underpins the investment approach. This scoring system, which is driven by qualitative factors, helps the team strip emotion from investment decisions, as well as undertaking all of the necessary rigorous number crunching. The system produces an absolute weighted score on factors such as a fund manager’s working environment, leadership and the fund size. This allows the team to compare past and present scores and also compare funds with each other.
Meeting managers is central to the process, and the team has developed a unique skill in finding specialist funds from boutique managers with a focus on sustainable high yield. The team spends as much time developing or researching new ideas as it does on the maintenance research. As the managers put it, “We like to be involved in a fund when it is building its track record rather than living off it!”
Risk
Holding around 30 funds, the team uses diversification as a key tool in reducing risk. It doesn't take extreme bets and does a lot of work analysing correlations between the funds in which it wants to invest.
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