Investing in a Fund of Funds
Excela’s Emergent and Maximiser funds are “funds of funds”, meaning they hold a portfolio of other investment funds rather than investing directly in equities.
Advantages of Investing in an Excela Fund of Fund
There are three main advantages of investing in an Excela “fund of fund”:
- Built-in diversification
- Flexibility to act quickly
- A perennial portfolio without paperwork
Built-in diversification
Diversification can be achieved within Emergent and Maximiser as each of them holds a portfolio of underlying investments across a range of asset classes, investment strategies and Fund Managers.
Known as a “Fund of Funds” this structure builds in multiple levels of diversification and investment manager expertise. The concept also provides more flexibility to adjust investments whilst at the same time actually reducing the amount of paperwork and administration this would normally require from an investor.
Plus, it allows the ability to invest in other vehicles such as indexes or swaps that are not normally available to everyday investors where they may provide further performance enhancement or diversification.
This diversification means investors have exposure to a group of investments that are selected for their compatibility within the fund. Not only is diversification used to smooth performance, it is also a powerful risk management tool.
Flexibility to act quickly
Circumstances are always changing and it’s important to be able to make adjustments in the portfolio quickly.
When market circumstances change that reveal new opportunities or potential problems, being able to act quickly is an enormous benefit.
The Excela Investment Team closely watches the performance and suitability of the Underlying Investments in each of the funds. This means that if they make up an investor’s portfolio, they benefit from the constant monitoring and attention that only a professional manager can provide.
We are always looking out for ways to enhance the performance of our Funds, adjusting the investment mix to market circumstances and always working toward strong performance.
If an investment within one of the Funds is outperforming or underperforming over a reasonable term or a change occurs in the market, we can adjust the investment mix accordingly.
With the flexibility within each fund to adjust the investment mix, we can align the selection of underlying investments with all phases of the economic cycle. This means that each of the Underlying Investments within the Funds can and will vary as market conditions change.
It also takes advantage of the fact that different economies and markets can have booms and busts at different times further providing diversification and risk management. All the while, for investors, there’s no need to move their money in and out of investments as different phases of the economic cycle are presented
Emergent Fund | Maximiser Fund
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