Rebalancing strategy now available on Zurich Investment Bonds
We are now delighted to extend this enhancement to Investment Bond products.
Earlier this year, Zurich launched Fund Rebalancing on Approved Retirement Funds, and it has proven to be very popular with Financial Brokers and with their clients.
Fund Rebalancing is an investment strategy which periodically rebalances the weighting of the funds in an investment portfolio. When implemented, portfolios will rebalance at a frequency of your clients choosing and in accordance with the fund split they selected at outset. This ensures their investment preference and risk rating remains intact throughout the lifecycle of the policy. With Zurich’s flexible approach, funds can be rebalanced monthly, quarterly, half yearly or yearly.
How does it work?
Let’s say the target asset split in a client’s portfolio was 50% Equity Fund and 50% Bond Fund at outset. If equity markets performed well during the period, the weighting in the Equity Fund may have increased, e.g. imagine the Equity Fund weighting has increased to 70%. The Fund Rebalancing strategy will automatically reduce the weighting in the Equity Fund and increase the weighting in the Bond Fund to get the portfolio back to the target asset split of 50%/50%.
What are the benefits of Zurich’s Fund Rebalancing strategy?
| Investor benefits |
Adherence to financial plans: Fund Rebalancing ensures that clients remain committed to their initial investment strategy. Enhanced control over asset allocation: This strategy offers greater control over target asset splits, maintaining alignment with the original risk profile. Reduced monitoring efforts: Since rebalancing occurs automatically, clients do not need to continuously monitor their investments to ensure alignment with their risk preferences. Portfolio stability: It provides stability in the product portfolio splits, maintaining a balanced investment structure. Consistency across a range of market conditions: Asset splits will be rebalanced to match the client's preferences, regardless of market fluctuations. Peace of mind: Clients can enjoy peace of mind, knowing that their asset allocations will remain closely aligned with the initial plan. Flexibility: The strategy allows for adjustments to the fund portfolio splits and the frequency of rebalancing, offering adaptability to changing client needs. |
| Financial Broker benefits |
Consistency with client agreements: The portfolio remains aligned with the asset splits discussed with the client, eliminating the risk of deviating from the initial specifications. Improved risk alignment: The strategy ensures better alignment with the client's original risk profile, enhancing investment suitability. Portfolio stability: It provides stability in the client's portfolio splits, maintaining a balanced investment structure. Simplified client review: By reducing the possibility of unexpected changes, rebalancing makes client reviews more straightforward and less time-consuming. |
Implementing a rebalancing strategy can offer advantages for both you and your clients. The stability provided by this strategy can simplify the review process and support smooth client interactions. By adopting rebalancing, you can offer a more structured approach to achieving their financial goals. Ultimately, this strategy not only benefits the clients but may also strengthen the broker-client relationship through improved trust and reliability.
Fund Rebalancing may be a useful strategy for your Investment Bond clients, speak to your Zurich Broker Consultant today to find out more.
Warning: Past performance is not a reliable guide to future performance.
Warning: Benefits may be affected by changes in currency exchange rates.
Warning: The value of your investment may go down as well as up.
Warning: If you invest in these products you may lose some or all of the money you invest.
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