Company unveils suite of seg funds, aiming to provide diversification and exposure to opportunities outside Canada
In these times of uncertainty and anxiety, RBC Insurance is offering advisors and investors a suite of funds it believes can alleviate some of the stress.
It is offering four RBC Global Portfolios, which can be aligned with various risk tolerance levels, and two QUBE low volatility funds. The fund manager is RBC Global Asset Management and the global portfolio are constructed using RBC Funds, PH&N Funds, BlueBay Funds and RBC iShares ETFs. For the low vol funds, RBC uses a sophisticated quantitative model overlaid with the investment expertise of the fund managers.
The seg funds have been available for a number of years but RBC Insurance has now added them to the seg fund line up by investing directly into their respective mutual fund versions.
Selene Soo, diirector, Wealth Insurance at RBC Insurance, told WP that the impetus for launching them in this form came down to the fact that 90% of the average Canadian assets are tied to Canada. She stressed this is not a bad thing and that Canada is home to a lot of great companies. However, Soo said the world has a lot to offer as well and that the fund additions offer real diversification with the aim of capitalizing on opportunities not available in Canada.
She said: “Investing in financial markets outside of Canada can increase the return potential while reducing volatility because when one region is performing poorly, another could be enjoying stronger performance, which could help achieve more stable returns over time.”
Soo added: “[The fund launches] were not a reaction to the pandemic but the messaging resonates now with all the market volatility and the uncertainty that's going on. As markets continue to recover from the impact of COVID-19, holding global investments, or low volatility equity funds, as part of your investment portfolio can be an effective way to manage volatility during these uncertain times.”
The global portfolios are designed to complement a client’s existing portfolio, while the low vol are designed for investors who want exposure to equities but don't have the risk appetite to take on volatility that generally comes with the territory. It provides some of the upside but protects from the downside.
Soo said seg funds offer guarantees that will help to protect investors' money, while at the same time allowing their wealth to grow. “This is especially important now, when markets are so volatile. Seg funds provide that safe haven for your money at death and at maturity. We’re living in times filled with uncertainty, anxiety and stress and we're concerned about our health and job security, and RBC insurance’s seg fund offering can help mitigate client concerns and fears.”
