A 15-minute watch.
In the latest in our Selector Series video interview, Dean Cheeseman, portfolio manager on Janus Henderson’s multi-asset team, talks to Gary Shepherd about why the “free lunch” of 60/40 models is over, and how active managers must up their game.
Dean works across Janus Henderson’s Diversified Growth Fund, its Multi-Asset Core Income and Multi-Manager ranges.
In picking active funds, he explains how he’s been focusing on those external managers who “really justify their inclusion, that have a style bias that we can identify, and can evidence that they are adding over and above a smart beta passive replication”.
“The traditional old school way of putting together multi-manager vehicles is far too over-populated and the danger is you end up with a very expensive tracker vehicle at the end of it that has diversified everything away,” he explains.
Still, Dean explains how he passionately believes that active management has “a very strong and vibrant role to play within investors’ portfolios” as the post-QE environment leads to increased volatility. However, he stresses that active must do more than just deliver returns.
“The active community now has to come to the table and demonstrate that we are acting as proper stewards of our clients’ capital,” he says.
“There is an expectation that we are delivering on those investment objectives. Whether its bringing in broader governance on ourselves; challenging as an active selector of external funds that we are applying different lenses through risk, through voting engagement, and looking at ESG through maybe a different optic, to push back on the active community and get them to step up and justify their fees.”
11 March 2020