Advisers drive demand for TD alternatives
Financial advisers are playing a key role in providing their clients with vital knowledge about alternatives to bank term deposits, according to global fund manager Pimco and its Australian partner Equity Trustees.
According to Harvey Kalman, head of corporate fiduciary and financial services at EQT – which acts as responsible manager of the Pimco EQT Australian Focus Fund – investors need to be more aware of the dangers of sequencing risk for their retirement income.
“While investors might not know what sequencing risk means, those who have retired in the last several years certainly know its impact on their retirement savings and are increasingly looking for help in finding fixed interest investment approaches that can manage this risk, without adding risk elsewhere,” he said.
Pimco head of global wealth management Peter Dorrian singled out the role professional advisers play in educating investors about these risks.
“Transitioning investors successfully from bank term deposits requires a thoughtful approach. While these investors likely want an attractive return, many are also seeking to preserve their capital,” Mr Dorrian said. “Short duration, high-quality fixed interest products which offer yields higher than cash with low volatility can provide an appropriate solution.”
EQT and Pimco have recently reviewed the Australian Focus Fund to ensure greater flexibility, off the back of feedback from financial advisers.
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