Multi-manager fund turnover spiked sharply in Q2, with cash allocations the main beneficiary, rising 1.6% to an average 7.2% holding, as managers hedged their bets around June’s election.
The Harrington Cooper asset allocation tracker, which follows the investment templates of 32 balanced multi-manager funds with a total £19.8 billion in assets, found exposure to both bonds and equity fell over the three months.
Fixed income allocations dropped 0.9% over the period to an average 24.1% while equity allocations dropped 0.7% to 51.8%.
The funds marketing and distribution business said that net sales of UK and US equity, down 0.19% and 0.38% over the period respectively, fund small net purchases of European and Japanese shares, up 0.3% and 0.14% respectively.
Within fixed income, managers moved sharply higher up the credit quality curve, with allocations to junk falling 2.1% and investment grade allocations rising 1.6%.