Global asset manager Legg Mason announced that the Legg Mason Martin Currie Real Income Fund has been included in the income model portfolio of Australia’s largest dealer group AMP, with a 5% (maximum) allocation.
Luke Mandekic, Manager Model Portfolios at AMP Advice Research undertook an extensive review process before deciding to include the Fund in the Property allocation. “Our AMP income models are designed to provide an innovative and optimal blend of best-of-breed funds to our adviser network. We have included the Real Income Fund on the basis that it is specifically designed for retiree income. We believe its broad exposure beyond AREITs can provide a more robust solution in the property sector”.
The Real Income Fund aims to provide an attractive income stream with natural inflation protection by investing in a blend of A-REITs, listed infrastructure and utilities. The Fund currently has a 52% weight to AREITs, 37% weight to listed utilities and 11% invested in listed infrastructure. The Fund’s strategy was launched in 2011 and it has grown to $470 million, with increasing financial adviser demand.
Legg Mason Head of Sales Beau Titchkosky said “We are receiving strong demand from both portfolio constructors seeking an alternative to stand-alone AREITs, as well as advisers seeking an attractive income solution in a low interest rate environment.”
The Legg Mason Martin Currie Real Income Fund has returned 19.6% p.a.in the three years to September 2015 after fees.
The Fund’s low risk profile and drawdown was highlighted in the September quarter when the S&P/ASX200 Index declined by 6.6%, while in stark contrast the Real Income Fund was up 2% after fees.
Legg Mason is hosting an adviser education teleconference on October 14 and is expecting a considerable number of fist time advisers to dial in seeking more information on real assets. Titchkosky said “Our adviser survey results indicate a strong appetite for attractive income options that are true to label, easy to explain to clients and have solid performance potential. We feel the Real Income Fund ticks all these adviser boxes”.