Investing for all of our futures ... creating a powerful legacy
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Mitesh Sheth
Chief Investment Officer, Multi-Asset,
Newton Investment Management.
In a volatile, inflationary, low growth world, we think investors need actively managed, global, sustainable solutions.
Introducing FutureLegacy
FutureLegacy is a range of five risk-targeted multi-asset funds that through the expertise at Newton Investment Management aim to help clients achieve their long-term goals investing for and during their retirement.
Managed to remain within the Dynamic Planner volatility bands 3-7, the FutureLegacy funds enable advisers to recommend a solution which aims to meet the needs, risk appetite and expectations of their client, identified as part of their advice process.
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Actively managed
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Global & sustainable
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Directly invested
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The FutureLegacy offering
Strategic and tactical asset allocation combined with sustainable security selection enables Newton to determine the optimal portfolio construction within the defined risk bands.
BNY Mellon FutureLegacy range
Newton offers a choice of multi-asset solutions to meet investors’ unique mix of yield / risk appetite.
Equity
- Emerging markets equity
- Europe ex UK equity
- Pacific ex Japan equity
- North American equity
- UK equity
- Japan equity
Fixed income
- EMD
- IG
- High yield
- Sovereign
Cash
- cash
0%
Equity
Objective:
To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk. The Fund will aim to
maintain a risk profile classification of 3 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external
third-party risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 15% SONIA GBP, 55% ICE BofAML Global Broad Index GBP Hedged and 30% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 15% SONIA GBP, 55% ICE BofAML Global Broad Index GBP Hedged and 30% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
0%
Equity
Objective:
To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk. The Fund will aim to
maintain a risk profile classification of 4 from a scale of 1 (lowest) to 10 (highest) which is assessed against the riskratings scale provided by an external
third-party risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% SONIA GBP, 45% BAML Global Broad Index GBP Hedged and 45% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% SONIA GBP, 45% BAML Global Broad Index GBP Hedged and 45% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
0%
Equity
Objective:
To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk. The Fund will aim to
maintain a risk profile classification of 5 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external
third-party risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 5% SONIA GBP, 35% BAML Global Broad Index GBP Hedged and 60% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 5% SONIA GBP, 35% BAML Global Broad Index GBP Hedged and 60% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
0%
Equity
Objective:
To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk. The Fund will aim to
maintain a risk profile classification of 6 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external
third-party risk rating agency
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 25% BAML Global Broad Index GBP Hedged and 75% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 25% BAML Global Broad Index GBP Hedged and 75% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
0%
Equity
Objective:
To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk. The Fund will aim to
maintain a risk profile classification of 7 from a scale of 1 (lowest) to 10 (highest) which is assessed against the riskratings scale provided by an external
third-party risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% BAML Global Broad Index GBP Hedged and 90% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% BAML Global Broad Index GBP Hedged and 90% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Target Volatility Band
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4.2%-6.3%
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6.3%-8.4%
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8.4%-10.5%
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10.5%-12.6%
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12.6%-14.7%
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Note: EMD = emerging markets debt, IG= investment grade
Source: Newton, 31 December 2023. Pie charts illustrate the breakdown of equities and bonds. Total does not sum to 100 due to rounding.
The BNY Mellon FutureLegacy funds are actively managed typically by using forward-looking expectations of volatility. In doing so, the Investment Manager uses its own internal risk model, whilst also considering external independent risk profiling methodologies. Based on a risk profile scale of 1 (lowest) to 10 (highest), the funds target risk profiles of 3, 4, 5, 6 and 7 but this is not guaranteed. The risk profile targeted by each of the BNY Mellon FutureLegacy funds can be identified through the number included in the respective fund’s name. This risk profile is not the same as the risk and reward category shown in the funds’ Key Investor Information Document(s). The risk profiles of the funds are currently assessed against the risk ratings scale provided by Dynamic Planner, but is subject to change at the ACD’s discretion. Dynamic Planner Risk Ratings should not be used for making an investment decision and it does not constitute a recommendation or advice in the selection of a specific investment or class of investments.
Risk Managed
BNY Mellon FutureLegacy 3 Fund
Objective: To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk.
The Fund will aim to maintain a risk profile classification of 3 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external third-party
risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 15% SONIA GBP, 55% ICE
BofAML Global Broad Index GBP Hedged and 30% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD
considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly
invests.
Risk Managed
BNY Mellon FutureLegacy 4 Fund
Objective: To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk.
The Fund will aim to maintain a risk profile classification of 4 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external third-party
risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% SONIA GBP, 45% BAML
Global Broad Index GBP Hedged and 45% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD
considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly
invests.
Risk Managed
BNY Mellon FutureLegacy 5 Fund
Objective: To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk.
The Fund will aim to maintain a risk profile classification of 5 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external third-party
risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 5% SONIA GBP, 35% BAML
Global Broad Index GBP Hedged and 60% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD
considers the composite index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly
invests.
Risk Managed
BNY Mellon FutureLegacy 6 Fund
Objective: To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk.
The Fund will aim to maintain a risk profile classification of 6 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external third-party
risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 25% BAML Global Broad Index
GBP Hedged and 75% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite
index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.This fund is
actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 25% BAML Global Broad Index GBP Hedged and 75% MSCI ACWI GBP NR as a point of reference
(comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite index to be an appropriate comparator because it includes a
broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Risk Managed
BNY Mellon FutureLegacy 7 Fund
Objective: To achieve capital growth and potential for income over the long term (5 years or more) while being managed to a pre-defined level of risk.
The Fund will aim to maintain a risk profile classification of 7 from a scale of 1 (lowest) to 10 (highest) which is assessed against the risk ratings scale provided by an external third-party
risk rating agency.
Benchmark: This fund is actively managed without benchmark-related constraints. The Fund uses a composite index, comprising 10% BAML Global Broad Index
GBP Hedged and 90% MSCI ACWI GBP NR as a point of reference (comparator) against which the ACD invites Shareholders to compare the Fund’s performance. The ACD considers the composite
index to be an appropriate comparator because it includes a broad representation of the asset classes, sectors and geographical areas in which the Fund predominantly invests.
Team Member
Position
Newton is a founding supporter of the charity The Centre for Financial Capability, and is a founding member of its ground-breaking collaborative project KickStart Money, which aims to take financial education to almost 20,000 UK primary school children, catalysing a movement to build a savings culture for the future.
Key investment risks:
- Objective/Performance Risk: There is no guarantee that the Funds will achieve their objectives.
- Currency Risk: These Funds invest in international markets which means they are exposed to changes in currency rates which could affect the value of the Funds.
- Derivatives Risk: Derivatives are highly sensitive to changes in the value of the asset from which their value is derived. A small movement in the value of the underlying asset can cause a large movement in the value of the derivative. This can increase the sizes of losses and gains, causing the value of your investment to fluctuate. When using derivatives, the Funds can lose significantly more than the amount they have invested in derivatives.
- Changes in Interest Rates & Inflation Risk: Investments in bonds/money market securities are affected by interest rates and inflation trends which may negatively affect the value of the Funds.
- Credit Ratings and Unrated Securities Risk: Bonds with a low credit rating or unrated bonds have a greater risk of default. These investments may negatively affect the value of the Funds.
- Credit Risk: The issuer of a security held by the Funds may not pay income or repay capital to the Funds when due.
- Emerging Markets Risk: Emerging Markets have additional risks due to less-developed market practices.
- Shanghai-Hong Kong Stock Connect and/or the Shenzhen-Hong Kong Stock Connect (“Stock Connect”) risk: The Funds may invest in China A shares through Stock Connect programmes. These may be subject to regulatory changes and quota limitations. An operational constraint such as a suspension in trading could negatively affect the Funds’ ability to achieve their investment objectives.
- Volcker Rule Risk: The Bank of New York Mellon Corporation or one of its affiliates (“BNYM”) has invested in these Funds. As a result of restrictions under the “Volcker Rule,” which has been adopted by U.S. Regulators, BNYM must reduce its shareholding percentage so that it constitutes less than 25% of the Funds within, generally, three years of the Funds’ establishment (which starts when the Funds’ manager begins making investments for the Funds). Risks may include: BNYM may initially own a proportionately larger percentage of the Funds, and any mandatory reductions may increase Fund portfolio turnover rates, resulting in increased costs, expenses and taxes. Details of BNYM’s investment in the Funds are available upon request.
- CoCo’s Risk: Contingent Convertible Securities (CoCo’s) convert from debt to equity when the issuer’s capital drops below a pre-defined level. This may result in the security converting into equities at a discounted share price, the value of the security being written down, temporarily or permanently, and/or coupon payments ceasing or being deferred.
- Sustainable Funds Risk: The Funds follow a sustainable investment approach, which may cause them to perform differently than funds that have a similar objective but which do not integrate sustainable investment criteria when selecting securities. The Funds will not engage in stock lending activities and, therefore, may forego any additional returns that may be produced through such activities.
- Investment in Infrastructure Companies Risk: The value of investments in Infrastructure Companies may be negatively impacted by changes in the regulatory, economic or political environment in which they operate.
- Counterparty Risk: The insolvency of any institutions providing services such as custody of assets or acting as a counterparty to derivatives or other contractual arrangements, may expose the Funds to financial loss.
The value of investments can fall. Investors may not get back the amount invested. Income from investments may vary and is not guaranteed.
Investment process
The FutureLegacy investment team has a unique blend of skills and expertise
Newton FutureLegacy Investment Team:
Mitesh Sheth
Chief Investment Officer Multi-Asset
Paul Flood
Head of Mixed Asset Investment
Bhavin Shah
Portfolio Manager
Martin Chambers
Portfolio Manager
Lale Akoner
Portfolio Manager*
Dimitri Curtil
Global Head of Multi-Asset Solutions
Brendan Mulhern
Head of Tactical Asset Allocation
Nancy Last
Senior Portfolio Analyst
Newton Research Team: All the portfolio management teams are supported by the Newton Multidimensional Research Team which consists of 63 investment professionals as at 31 December 2023 (some of whom combine research and portfolio management roles). The research platform blends thematic, fundamental, macroeconomic, geopolitical, regional, quantitative, accounting, private markets and investigative research that takes material ESG risks, opportunities and issues into account (where relevant) to give Newton Investment Management the widest perspective on the investment landscape.
Newton AUM by investment team (as at 31 December 2023)
1 Newton’s global AUM is adjusted lower to factor in any double counting of affiliate fund or fund-of-fund assets which can occur when a Newton multi-asset strategy invests in a BNY Mellon fund, that is sub-advised by Newton. At end December 2023, total assets invested by Newton multi-asset strategies on this basis was £2.6bn. To avoid double counting we extract these assets from Newton’s global AUM, which results in a total global AUM of £83.9bn for Newton. Mixed Assets and Charities team assets of £11.5bn includes £1.6bn of this form of double-counted assets. Multi-Asset Solutions team assets of £14.0bn includes £1.1bn of this form of double-counted assets.
Assets under management (AUM) relates to the combined assets managed by the Newton Investment Management group. From 1 September 2021, Newton group of companies includes Newton Investment Management Limited (NIM) and Newton Investment Management North America LLC (NIMNA).
Resources & articles
Newton head of mixed assets investment Paul Flood considers how the bond market has reacted to central bank policy decisions.
Why the electric vehicles (EVs) trade could be set for a boost – and why Newton is well prepared to explore this and other alternatives markets.
Newton head of mixed assets investment Paul Flood assesses some of the investment opportunities and themes stemming from this year’s global elections.
Why identifying companies with quality attributes, and revisiting the true reason why people invest, can help build resilient multi-asset portfolios.
Newton head of mixed assets investment Paul Flood considers whether the bond market has been too aggressive pricing in interest rate cuts so far this year.
How a shifting inflationary picture is influencing asset classes and portfolio management.
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