Look beyond ratings for an in-depth understanding of investment risk

 Now more than ever, it’s a good idea for advisers to look further than ratings to fully understand how investment funds align with their clients’ specific risk profile.

Risk ratings provided by independent agencies are a brilliant starting point for advisers working to determine the risk profile of different investment funds, both on and off-platform.

These ratings are useful as they provide a single metric that allows an adviser to assess a potential investment at a glance. But, while ratings provide a fast and cost-effective way to determine suitability and meet regulatory requirements, they don’t always tell the whole story. For example, they don’t typically consider the smoothing mechanisms used by some funds, which are an important factor when assessing risk.

Nick Henshaw, Head of Intermediary Distribution at Wesleyan, explores why it’s important to remember that while ratings are a helpful way for advisers to give clients an indication of risk, there are a number of other factors that are worth considering alongside them, to ensure the level of risk for a client is fully represented.

Read the full article to discover more

Wesleyan’s With Profits Growth Fund

Wesleyan, a financially strong mutual with a history of over 182 years, has developed the first smoothed UK With Profits fund to sit on multiple independent wrap platforms, making it easy for advisers to access and combine into a client’s investment portfolio.

The actively managed Wesleyan With Profits Growth Fund, invests in UK and international stocks, government and corporate bonds, property, cash and more. The fund’s unique smoothing mechanism means volatility is extremely low*. This can offer clients the benefits of higher returns associated with being invested in equities, with relatively lower risk.

To discover more about this fund visit wesleyan.co.uk/intermediaries, get in touch at [email protected] or connect on Linked In.