State Street Global Advisers (SSgA), a US diversified financial service firm, has rolled out its new series of low cost lifestyle products for Australian retirees, which will assist them to meet various retirement lifestyle objectives.
According to the company, the products will be delivered to Australian retail investors through local investment platform Netwealth Investments from mid October, while other platforms will also be added for distribution of the fund in due course.
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The three Retirement Lifestyle Solutions include the Builder Strategy for people in the accumulation phase, the Sustainer Strategy for investors who are nearing preservation age and desire better capital protection, and the Provider Strategy for retirees drawing income from their portfolio.
Based on the response from portfolio construction professionals including advisers, researchers, investment committee members and super fund trustees, the company has developed the retirement lifestyle solutions series.
The new suite of funds has been manufactured in response to the losses experienced by superannuation investors during the GFC.
Dan Farley, global CIO of SSgA’s investment solutions group, said: "We had a lot of conversations with portfolio construction professionals when we were designing these funds. The feedback we received was consistent.
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By GlobalDataThese professionals want solutions that support investor engagement, that acknowledge investors’ behaviour and lifestyle aspirations change during different stages of life and market cycles, that explicitly manage risk and return, and that are cost effective.
"How retail investors experience risk and return in the lead up to and the actual retirement phase is very different to how institutional investors assess it. Retail investors are mostly interested in total return, the volatility of returns and the possibility of losing their capital. Benchmarks and tracking error are not as important to retail investors."
"The SSgA retirement lifestyle solutions series is designed to address the retirement conundrum facing investors by providing meaningful levels of real income while mitigating the effect of short-term volatility.These strategies help with many of the complex and challenging investment decisions faced by investors as part of their retirement planning, from the accumulation phase through to the later years of retirement.
We believe a solution that addresses their lifestyle aspirations, offers a fit-for-purpose strategic asset allocation, dynamically manages exposures and explicitly manages equity risk – all at a cost of 75bp – could be a game-changer in the market," Farley added.
