Time is something few investors can afford in the current global marketplace. Between the increased financial risk of taking on previously surefire investments post-COVID and the vastness of options, it may come as no surprise that even experienced investors are becoming increasingly risk-averse with their portfolios. Fully managed investments and the professional investment managers responsible for them can be an appealing alternative for investors who are time-poor, risk-averse or unsure about the best way to preserve their capital. But what makes them so viable?
As specialists in socially impactful, fully-managed investment opportunities, Concept Capital Group offers a tailored solution to alternative real asset investing. As a result, our team of experts have developed a deep understanding of why investment management can be beneficial to the average investor. For an answer to why anyone interested in building wealth with a robust portfolio should consider a fully managed investment strategy, look no further than this week’s financial blog.
What are Fully Managed Investments?
A fully managed investment is a fund, asset or other investment opportunity that seeks to capitalise on the experience of professional or institutional investors by leaving the responsibility for managing the investment in question entirely to them. In most instances, a fully managed investment will encompass a client’s portfolio or a ready-made investment fund. This would require the investment manager to oversee either the individual investment opportunities chosen for the portfolio using their expertise or the selection of ready-made funds and assets offered to their clients.
Fully managed investments come in various formats and cover anything from private equity to ETF funds. Whether full management involves wealth management, asset management, investment management or the management of an entire portfolio, the investment manager is expected to closely consult with the client to achieve a mutual understanding of the investment strategy they will develop. This can include more active approaches for clients with a high-risk appetite and wealth profile or more passive approaches that try to ensure consistent market returns at the expense of bigger victories. Any fully managed investment strategy will be tailored to the client’s specific financial outlook, including asset allocation and diversification. This allows for a bespoke service that will yield the most positive results for their portfolio.
Most investment firms revolve around bespoke, fully managed investment packages in assets and securities, including market leaders like BlackRock and Goldman Sachs. Some banks, like Lloyds TSB, have ready-made investment funds that allow everyday customers to effortlessly become investors.
What are the Benefits of Fully Managed Investments?
A fully managed investment opportunity can bring a lot to an investor’s portfolio and passive income. Partway between a financial advisor and an expert in wealth and asset management, investment managers can be stalwart allies in an increasingly unpredictable market, offering their investor clients the keen insight and perspective on incoming (and outgoing) trends that can make or break their profitability.
Beyond the expertise of individual investment managers, however, fully managed investments boast a universal appeal that makes them a solid alternative to managing one’s portfolio. Here are three of the leading reasons investors should consider fully-managed investments.
1. Simplifying Market Complexity to Save Time and Effort
Perhaps the most common reason investors seek out fully managed investments is to ease the burden of having to manage their investments themselves.
The rise in available market data seen in the last few years has created a level of market complexity that has alienated many present and would-be investors. A 2023 Wealthify survey on the main barriers to investing in the UK showed that as many as 85% of British people preferred to use savings accounts over investing. Among the many reasons cited for this preference was a belief among 75% of British investors that they lacked the knowledge to invest safely. A further 61% argued that the process of investing seemed overly complicated.
Similarly, a 2024 survey by JPMorgan Chase showed that 68% of older investors are working with a financial adviser to secure their investments. And, although the same survey showed that most millennials are individual investors, they have been known to seek similar input on simplifying the market through social media, podcasts and digital advisers. In either case, those surveyed suggested that market volatility and diversification were primary drivers in their decision to invest. Fully managed investments are unique in their ability to mitigate or boost these drivers respectively by relying on the fund manager’s experience.
Certainly, many investors who opt for fully managed investments do so with the expectation that clarity is king. As a 2024 report by professional services firm, Deloitte, suggests, many investment firm clients believe performance comes second to personalisation, timeliness and clarity in their interactions with their investment manager, and transparent fund performance reporting.
2. More Resources and Investment Opportunities
When it comes to investing, the only thing that beats experience is access. Firms that offer full-time investment packages typically have a range of resources and systems put in place to streamline the investment process for their clients, meaning the average investor can better capitalise on market trends and growth areas through an investment manager than on their own.
Depending on the time horizons, risk capacity and ethical leanings of their clients, investment, the entirety of an investment firm could effectively collaborate to maximise the success of the people and portfolios they represent. This can be especially true in the case of alternative investment opportunities in private markets, where asset and investment managers are expected to play a growing role in the next few years according to a 2024 report from consultancy firm EY.
Further findings from PwC suggest that 90% of asset managers are already using disruptive technology such as big data and the blockchain to enhance the efficacy of their investment management, with assets managed by robo-advisors expected to double 2022 figures and reach $5.9 trillion by 2027.
3. A Collaborative, People-Oriented Approach to Investment
As ethical investments and ESG strategy continue to centre themselves as the future of finance, an increasing number of investment firms are prioritising customer experience as a means of attracting and retaining investors.
As Deloitte highlights, generative AI is being increasingly relied upon to transform the timelines and clarity of customer interactions. Likewise, a renewed focus is being placed on more frictionless onboarding customer grievance resolution and long-term relationship building among the top wealth management firms. This is especially relevant in a contemporary investment landscape, as 21% of investors are less likely to invest in a new manager when faced with market uncertainty.
As the market grows, Deloitte suggests that a partnership approach between managers and their clients will be instrumental in driving markets forward, and a long-term approach will be favoured on both sides of the divide.
Fully Managed Investments at Concept Capital Group
At Concept Capital Group, we offer a simplified, accessible approach to fully managed investments that emphasise relationship management and transparency that will yield the best results for our clients. Our buy-to-let modular homes are real assets positioned in the social housing sector, allowing them to benefit from the extreme demand for housing gripping the UK while providing an ethically-minded solution to the housing crisis.
For more information on our investment opportunities, book a call with our team today.
