Forcing fund managers to "slavishly follow" risk parameters ties their hands behind their backs and runs the risk of disappointing investors, Henderson's global head of products and distribution has said.
James Bowers said the multi-asset market - which includes around £6.4bn run by a team at Henderson - is in "a potentially dangerous situation" if products are designed that focus all their attention on managing volatility as a proxy for risk, without considering performance. "Ultimately, you are paying an investment manager for his skill and insight and the ability to use his experience to navigate his way through financial markets, exploiting opportunities and avoiding traps," he said. "So if you tie an investment manager's hands behind his back and say he has to follow this volatili...
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