Glacier by Sanlam assists clients to achieve long-term portfolio growth
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2012
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17
Apr
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Glacier by Sanlam has launched Glacier P2 Strategies, an investment option overlaid on funds that balances growth with safety.
This follows the successful launch by Glacier International, in 2010, of the P2Strategies on its international platform. The strategies are now available to investors on the local platform as well.
The strategies allow investors to invest more money in growth assets such as equities, while helping to reduce the risk of sudden and large losses in their portfolio due to market downturns.
This is achieved through dynamic rebalancing of the client’s portfolio between growth assets and money market instruments according to how the markets are performing. So when equity markets are declining, for example, a greater proportion of the client’s portfolio will be allocated to money market instruments, but as equity markets rise so the allocation to growth assets will increase. Clients can also personalise their investment according to their own risk profile by selecting the level of preservation they require. Glacier P2 Strategies therefore give clients more control over their investments and retirement planning.
“In the 21st century we’re seeing people not only living longer, but also retiring earlier,” says Verusha Ramlakhan, product manager at Glacier by Sanlam. “This means that preserving and growing your capital is more important than ever, and this means having a certain portion of your investment in growth assets.
“A large reduction in your investment value, caused by market downturns, could set your investment strategy back many years, and this is where the value of Glacier P2 Strategies comes in – helping you achieve long-term investment growth with reduced volatility,” adds Ramlakhan.
Recent research conducted by the Unilever Institute of Marketing at UCT, which looked at the top end of the local consumer market, found that most respondents’ goals included a comfortable retirement, even at the very top end of the market.
Ramlakhan says that typically clients want the same income when they retire as they had before retirement. “However, looking at the retirement annuity (RA) and investment linked living annuity (ILLA) investments on our platform, we can see that clients are cautious when it comes to investing in growth assets,” she says.
“45% of RA investors in the 35 – 45 age group have less than 50% in growth assets. When looking at investors in the investment linked living annuity (a post-retirement product), the percentage allocated to growth assets is lower still.
“Given that we have the largest ILLA book in our industry, we understand the importance of looking after one’s long-term savings and the negative effects that volatile markets can have on these savings,” says Ramlakhan. “We also strongly advocate that clients consult a financial intermediary, as planning needs are often complex. In addition, using the services of a financial intermediary brings discipline to the planning process.
“Glacier P2 Strategies provide clients with the peace of mind to stay invested in the markets despite the volatility, as the strategies aim to limit large drops in the value of the portfolio. They also assist to smooth the path between pre- and post-retirement saving by providing comfort over the level of return on the investment,” concludes Ramlakhan.
The investment is managed on a daily basis by Glacier under advice from experts at Milliman, one of the world’s largest risk management firms, and with marketing and systems support from Bermuda-based P2international, Ltd.
Source: Glacier Financial Solutions (Pty) Ltd, A member of the Sanlam Group
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