HSBC Launches Low-Cost Passive Portfolios
The portfolios contain index trackers and exchange traded funds to keep annual costs down
HSBC Global Asset Management (GAM) has launched three multi-asset funds which contain low-cost, passive vehicles.
The HSBC Global Strategy portfolios are risk-targeted and span from cautious to balanced and dynamic, with annual fees of between 0.17 percent and 0.20 percent.
Phil Reid, head of wholesale UK, at HSBC GAM, said the portfolios have active asset allocation to move between equities, bonds and property across developed and emerging markets.
“We believe that the range fits well with clients’ requirements for simple cost-effective products that provide risk-focused asset allocation across global markets,” he said.
HSBC carried out research that found 74 percent of independent financial advisers (IFAs) said they looked at multi asset funds for their ability to offer lower fees. The portfolios will contain passive funds, with the flexibility to use active funds, to keep costs low.
The funds will be available on advisory platforms from 16 October. HSBC hasn’t launched an ETF since the summer of 2014, when it brought to market a fund that replicated the value of countries’ economic footprint rather than market capitalisation, closely followed by a global equities ETF which weights by market cap.
Year to date HSBC has lost €577 million from its ETF range and currently holds 1.2 percent of European ETF asset share.
In May HSBC spoke out against the liquidity constraints of emerging market and frontier ETFs, and advised investors to look elsewhere for yield.
