Octopus Portfolio Manager is a risk-targeted portfolio management service, each of the ten investment profiles targets a specific level of risk and aims to generate the maximum level of return for the amount of risk taken. Investments are diversified and regularly rebalanced across multiple asset classes, regions and funds. The advantage of this approach is that it provides portfolios that are more likely meet the risk requirements of the investor, and it offers investors extensive diversification - a typical portfolio will give exposure to around 75 underlying funds.
The ten investment profiles (models) are:
- Cash (not available on platform)
- Cash Plus (not available on platform)
- Defensive Capital Growth
- Conservative Capital Growth
- Moderate Capital Growth
- Progressive Capital Growth
- Managed Equity Growth
- Advanced Equity Growth
- Global Equity Opportunities
- International Equity Focus
Each Octopus Portfolio Manager investment profile is made up of a combination of up to six 'Foundation Funds' (plus a proportion of the investment held in cash in profiles 1 and 2). Each Foundation Fund is a ‘fund of funds’ in its own right, holding 15 to 25 different underlying funds, and has a specific investment objective linked to the asset classes and/or regions in which it invests. The six Foundation Funds are FP Octopus Fixed Income, FP Octopus UK Equity, FP Octopus International Equity, FP Octopus Dynamic Mixed Asset, FP Octopus Global Strategies and FP Octopus Global Growth.
The blend of these funds in the investment profile determines the risk and return level that is being targeted. So, for example, a low volatility profile such as 3. Defensive Capital Growth will have a greater exposure to Foundation Funds with fixed income assets and alternative strategies, whereas a higher volatility profile, such as 8. Advanced Equity Growth, will have a stronger focus on the equity-based Foundation Funds.