Age-tailored approach to equity needed, says fund manager

Fund managers must adopt a more risk averse approach to managing equity as the population ages, a fund manager believes.

Fully-invested strategies suitable for younger investors who can ride out cycles are often "fraught with danger" for older investors, according to Insync Funds Management's chief investment officer Monik Kotecha.

"Managing downside risk and minimising negative returns has to be at the core of any investment strategy," he said.

"This is in sharp contrast to a fully invested at all times, short-term, momentum-investing approach, driven by the cult of relative performance.

"There is a sharp disconnect between the end investor and many professional advisers, with the former needing absolute returns and the latter focused on relative returns."

Kotecha said an investor's ability to recover from loss diminishes as they age, which means age-tailored strategies are critically important.