UK-based AXA Investment Managers has launched two new smart beta products, AXA IM SmartBeta Equity and AXA IM SmartBeta Bond, which have been designed as alternatives to index trackers, Financial Standard reported.
Both AXA IM SmartBeta Equity and AXA IM SmartBeta Bond strategies use rules based filters to reduce exposure to risks associated with passive investments such as concentration risk, cost leakage and diversification concerns.
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The company aims to deliver solutions to help investor’s access equity beta cheaply and efficiently with the help of the two products.
Financial Standard quoted AXA IM head of institutional client strategy, Tim Gardener, as saying: "In harvesting beta, a smart investor is not looking to take ‘bets’ as an active manager might, although they are persuaded of the need to avoid the pitfalls of blindly tracking an index."
He further added that the filter process on the equity strategy essentially removes the bottom stocks that ‘no one with any common sense would invest in.’
"The smart investor recognizes that equity investing involves taking on risk, but wishes to limit both longer term loss of wealth and shorter term downside volatility by avoiding, as far as possible, the stocks that are overvalued when markets head south."
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