As ways to access financial markets continue to evolve, there is a growing demand from many investors for a low cost indexation approach to investing. Index-based investing is achieved by aiming to replicate a specific investable index of securities. Rather than seeking to beat the market through active management, investing is instead carried out through a passive investment strategy.
Barclays GlobalBeta (and Barclays Global Markets) offer an innovative way of doing this. Rather than you investing directly into individual index funds, Barclays GlobalBeta gives you a choice of globally diversified portfolio index funds, predominately Exchange Traded Funds (ETFs).
An index fund represents a portfolio of shares or bonds that aims to provide cost-effective and consistent performance in relation to a specific market or index, for example the FTSE 100 or S&P 500. Once fees are taken into account, index funds and ETFs can offer cost advantages over traditional active funds in gaining exposure to a specific market.
Barclays GlobalBeta comprises five risk-profiled portfolios which are globally diversified across both equity and fixed income markets and the GlobalBeta Equity portfolio that invests in global equities. Each of these strategies is available in three currencies, sterling, US dollar and euro.
Reasons to invest through GlobalBeta:
- A fully implemented solution: Decisions as to which asset classes and index funds to invest in are taken for you, in line with your risk profile and objective.
- Lower costs: Index funds can offer cost advantages over actively managed funds because of, for example, lower trading and research costs.
- Transparency: Index funds have transparent portfolio holdings, so investors know exactly where their money is invested.
- Superior diversification: Multi-asset portfolios include non-traditional asset classes such as emerging markets in keeping with your risk profile.
- Efficient investment strategies: Quantitative modelling helps create optimised portfolios and seeks to maximise potential return for a given level of risk.
- Smoother investment returns: Index funds seek to replicate an index rather than seeking to beat the market, allaying concerns of potential underperformance against the market.
- Dedicated professionals: We have dedicated teams focusing on asset allocation and implementation.
- Dynamic asset allocation: Mix of assets adjusted to reflect the Barclays view on investment markets for additional return potential.
- Tax efficient: Investments bought and sold within your portfolio with no capital gains tax, though you need to bear in mind that tax rules can change and that their benefit to individuals depends on those individuals' circumstances.
- Simplified paperwork: Investment into multiple index funds, but consolidated reporting and income.
Important Information and Risks
Past performance is not a guide to future returns.
The value of investments and any income from them is not guaranteed and may fall as well as rise. You may lose some or all of your investment.
Investing in funds should be considered for the medium to long term, that is, five years or longer.
Where funds invest in emerging markets (which are generally less well-regulated than the UK) there is an increased chance of political and economic instability and these markets can be less liquid.
Where funds invest in securities denominated in multiple currencies, the value of investments and any income from them may therefore decrease or increase as a result of changes in exchange rates between currencies.
Funds investing in fixed income securities are sensitive to changes in interest rates. An increase in interest rates will generally reduce the value of fixed-income securities, while a decline in interest rates will generally increase the value of fixed-income securities.
For fund specific key risks, please refer to the relevant Key Investor Information Document (KIID).