AJ Bell recently cut the annual management charge of its MPS to 0.15% + VAT and the new income portfolios will also benefit from this. There are two investment objectives, each of which are available as a passive or active underlying portfolio.
Income 1 has a target yield of 4% and aims to offer long term capital protection. The passive portfolio has an underlying OCF of 0.34% and the active portfolio has an underlying OCF of 0.66%.
Income 2 has a target yield of 4% and aims to offer long-term inflation protection. For those investors wary of the impact of potentially rising interest rates on bonds, the Income 2 portfolio has no exposure to bonds. The passive portfolio has an underlying OCF of 0.35% and the active portfolio has an underlying OCF of 0.73%.
AJ Bell’s MPS is available to advisers exclusively via the AJ Bell Investcentre platform. It now offers advisers and their clients a total of 16 portfolios – there are six different risk levels as well as the two new income options, each of which are available as a passive or active underlying portfolio.
All of the portfolios are benchmarked against Distribution Technology’s Dynamic Planner risk ratings and are also mapped to Finametrica’s risk levels to make it easy for advisers to incorporate them into their existing business processes. The portfolios are risk targeted as opposed to risk rated, to ensure the portfolios consistently target the stated level of volatility, giving advisers and their clients greater certainty that the portfolios are meeting their objectives.
Kevin Doran, chief investment officer and MD of AJ Bell Investments, comments:
“The search for income remains a key investment priority for many investors, particularly in the extended low interest rate environment and with many more people remaining invested in retirement and utilising the new pension freedoms. Advisers have told us that an income option in the MPS would suit a significant number of their clients and we are pleased to be able to launch these four new portfolios for them.
“They can choose from capital or inflation protection with a target yield of 4% and as with the rest of the MPS, there are both passive and active options. The annual management charge of 0.15% plus VAT makes the service one of the best value in the market and we have made it as easy as possible for advisers to use by mapping it to the existing risk profiling tools that many of them already utilise within their business.”