One of the core tenets of a prudent investment process is to diversify clients’ investment portfolios across asset classes. Asset allocation is where most of a portfolio’s performance is determined–not securities selection. Lately, some of the smartest thinkers have been recommending allocations to a much broader array of asset classes, in order to take advantage of lower correlations among some of the less typical investments and in the hope of a higher risk-adjusted return.
DoubleLine Funds Trust has filed to launch a new actively-manage fund, DoubleLine Multi-Asset Growth Fund, “with the potential for capital appreciation, but may also seek to control risk by broad diversification among asset classes, market and economic sectors, and issuers.” The preliminary filing adds that, “The Fund’s portfolio will be actively managed, and the allocation of the Fund’s assets to asset classes, market sectors, and issuers will change over time, sometimes rapidly.”
DoubleLine Multi-Asset Growth Fund will be managed by the company’s CEO, Jeffrey E. Gundlach, President, Philip A. Barach, and Luz M. Padilla, Bonnie Baha and Samuel Garza.
The fund’s broad mandate will allow it to make “make any investment or use any investment strategy consistent with applicable law,” including short sales, derivatives, exchange traded funds or notes, investment pools, closed- or open-end funds, in any country. There are no limits on allocations to specific assets or countries, making it a go-anywhere type of fund.
The fund may allocate to, among others, equity; debt; real estate; infrastructure; commodities–physical or via securities indexes, futures, options or forwards; currencies; and short-term paper.
The management fee is 1% across the board. There is a 4.25% class A share load; a 1% redemption fee across all classes if sold within 90 days; and a 1% contingent deferred load for class A shares sold within 18 months and class C shares sold within a year. There are 12b-1 fees of 25 basis points for the class A and N shares; 1% for the class C shares; none for the class I shares. Investment minimums are $2,000 for the class A, C, and N shares; $100,000 for class I shares.
Comments? Please send them to firstname.lastname@example.org. Kate McBride is editor in chief of Wealth Manager and a member of The Committee for the Fiduciary Standard.