The HSBC Open Global Property fund, a globally diversified multimanager portfolio, has celebrated its third anniversary by achieving a top decile performance since inception.
Launched on November 26, 2007, the HSBC Open Global Property fund has achieved a strong total return of 8.8% over the period more than 27% ahead of the of IMA Property Sector average performance of -18.3%.
Managed by Guy Morrell since inception, alongside the real estate team within HSBC Multimanager, the portfolio invests in both direct (bricks and mortar) property funds and property securities (equity) funds. It aims to provide investors with the opportunity to spread their asset allocation across commercial property globally, thereby achieving greater diversification and reducing the risk of over-exposure to any individual country.
The fund is designed to offer investors three primary advantages. First the manager takes an active approach to geographical allocation as property markets tend to be local markets, largely driven by local demand and supply factors. This means considering property on a global basis provides the potential for diversification. Currently the fund has investments spread across the UK, Asia Pacific, North America and continental Europe
Second Morrell invests in funds which have investments in both unlisted and listed property markets, as well as cash. This active approach to asset allocation, blending both direct and listed property funds and taking a global perspective, provides the opportunity for superior risk-adjusted performance. Presently the HSBC Open Global Property fund is generally evenly split between the two asset classes.
And finally, as Morrell is a fund-of-funds manager, he is able to identify high quality managers in each part of the market and access their specialist, local skills.
Commenting on the HSBC Open Global Property Fund's third anniversary, Guy Morrell, said: "Over the past three years, commercial property investors have endured a period of unparalleled volatility but the fund has managed to deliver a top-decile return of almost 9% to its investors. This has been the result of the combined strategies of top-down asset allocation and careful manager selection. This strategy still holds for the portfolio, offering investors global exposure via unlisted and listed property holdings through a fund-of-funds approach.
"Property has the ability to generate attractive returns and provides strong diversification qualities as part of a broader investment portfolio. Considering a global perspective through a fund of funds route, offers the potential to secure higher returns over the medium term and further reduce overall volatility."