Barings closes targeted return multi asset fund following outflows

The £92m Barings Multi Asset fund is the latest targeted absolute return fund to close following continuous outflows, Investment Week has learned. 

The fund, managed by Christopher Mahon and Alison El-Araby, struggled to meet its objective, to generate a return in excess of UK inflation, last year.

It lost 14.7% gross of fees from end of March 2019 to the same period in 2020, according to FE fundinfo. This compared to its performance comparator RPI, which was 2.6% for the period.

Over a three-year period, Barings' target timeframe, the fund just managed to outperform RPI which was 2.2%, compared to the fund, gross of fees, which returned 2.4%.

"Following a thorough review of our UK multi asset business and as a result of industry forces, we will close funds in UK multi asset," a spokesperson from Barings said.

Funds in the Investment Association's Targeted Absolute Return sector struggled in 2020, with £12.6bn outflows over the course of the year, according to data from FE fundinfo. This was the third consecutive year it lost money.

A document seen by Investment Week said that Barings' review of the multi-asset fund looked at its future prospects which had continuous outflows. It concluded that it is unlikely the fund will attract significant new investment and believe closing the fund is in the best interests of investors.

The fund will be closed from 30 June.

"Our Asia multi asset business, led by James Leung and his team, is robust and remains unchanged," the spokesperson added.   

First published by our sister title Investment Week