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This year is the tenth anniversary of the launch of Robeco Global Conservative Equities. It is more than just a pure low-volatility fund.
‘If I were a pure low-volatility manager, I wouldn't be able to sleep as well at night now’The combination of these three factors results in a higher Sharpe ratio - but also a better diversification over sectors, a lower tracking error and a higher up capture. “I'm just very happy that we chose an enhanced strategy for Conservative Equities. For example, low-volatility stocks have now become much more expensive than they were ten years ago. On average Conservative Equity stocks are around 25% cheaper than pure low-volatility stocks.” Including Momentum is also “very beneficial”, according to Van Vliet, especially for timing the sale of losers. “If I were a pure low-volatility manager, I wouldn't be able to sleep as well at night now”.
‘Low Volatility is becoming popular so providers may well resort to more complex variants’Our pioneering approach and long track record form a good basis for this, but according to Van Vliet the fund needs to continue forging ahead. “The low volatility factor is popular and attracts many providers that are also resorting to more complex variants. For the wider public, we want to move away from this technical realm and communicate the simple message that Conservative Equities is a reliable, defensive equities solution. Stable, with a focus on dividend; a strategy that can also lag somewhat in bullish markets, but for defensive investors is a good alternative to a global fund at Vanguard or Fidelity or a high dividend fund.”
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