19 October 2020
Vitality VIRO funds celebrate third anniversary
Vitality is celebrating the three year anniversary of their VitalityInvest Risk Optimiser (VIRO) funds as part of its investment offering. The anniversary provides advisers with a three year track record of the funds’ performance and is a significant milestone for Vitality being the first of its fund ranges to hit this significant milestone.
The five funds that make up the VIRO range were incepted at the end of September 2017, in advance of Vitality’s entry into the retail savings market and launch of VitalityInvest in June 2018.
The five funds, which invest across a range of asset classes, are designed to optimise returns, while remaining within their assigned risk level. This approach supports advisers to cater for different risk profiles, and for them to be tailored to the life stage of a client. The funds are commonly used for clients looking to accumulate wealth or those in retirement who are looking to preserve their wealth.
The Vitality funds are built from Vanguard index trackers, with asset allocation input from Dynamic Planner. Vitality additionally review the asset allocation through daily monitoring and rebalance the funds where needed to ensure the funds continue to meet their target asset allocation.
Despite a challenging market environment, with high market volatility in recent months, the VIRO funds have been resilient. The funds have delivered against their investment objectives to provide long term growth whist remaining within their pre-determined target risk profiles. The funds additionally performed well relative to their peer group with actual volatility over the three years within expected parameters.
Fund performance and IA Sector Quartile ranks as at September 2020
| Fund Name | 3 year ann. fund performance | IA Quartile rank | IA Sector |
|---|---|---|---|
| VitalityInvest Risk Optimiser 3 | 3.70% | 1 | Mixed Investment 0-35% Shares |
| VitalityInvest Risk Optimiser 4 | 3.80% | 1 | Mixed Investment 20-60% Shares |
| VitalityInvest Risk Optimiser 5 | 3.80% | 2 | Mixed Investment 40-85% Shares |
| VitalityInvest Risk Optimiser 6 | 3.30% | 2 | Mixed Investment 40-85% Shares |
| VitalityInvest Risk Optimiser 7 | 2.00% | 3 | Mixed Investment 40-85% Shares |
Source: VitalityInvest and Morningstar, October 202
Fund volatility vs DP risk profiles as at September 2020
| Fund Name | 3 year annualised fund volatility | DP Risk Profile ex-ante volatility band | |
|---|---|---|---|
| Min Vol | Max Vol | ||
| VitalityInvest Risk Optimiser 3 | 5.40% | 4.20% | 6.30% |
| VitalityInvest Risk Optimiser 4 | 7.50% | 6.30% | 8.40% |
| VitalityInvest Risk Optimiser 5 | 9.40% | 8.40% | 10.50% |
| VitalityInvest Risk Optimiser 6 | 10.90% | 10.50% | 12.60% |
| VitalityInvest Risk Optimiser 7 | 12.70% | 12.60% | 14.70% |
Additionally, where a member has a plan with Vitality’s Healthy Fee Saver* and invests in VIRO funds, they get access to discounted product charges starting at 0.25%, with zero product charges on amounts above £250,000. Members also have the ability to lower their product charges to zero on all amounts by engaging in the Vitality Programme, which is embedded in all plans and enjoy the benefits of a selection of our reward partners from the beginning of their plan. Since the funds launched three years ago, members have saved nearly £200,000 in product charges across all Vitality and third-party funds.
The VIRO funds are part of a range of investment solutions offered by Vitality. Earlier this year Vitality also launched their Global Multi-Manager funds offered in partnership with SEI Investments, together with a Blended Fund range. All these funds are offered in addition to Vitality's Performer funds available through Ninety One.
Justin Taurog, Managing Director of VitalityInvest said: “Reaching three years for our VIRO funds is a big milestone for us, and shows how important ready-made solutions that balance diversification, governance and value across a fund range are for clients and advisers alike.
“Despite market volatility and extreme market pressures, the funds have demonstrated their resilience, delivering strong performance versus their peer group. “Since our launch, our focus has been to bring together a range of versatile fund solutions, with benefits that encourage positive lifestyle behaviour across both finances and health, and in doing so we have been able to provide a unique proposition that is supporting many people to plan for and have a long and healthy retirement.”
Chris Jones, Proposition Director, Dynamic Planner said: "Given the current backdrop, it has never been more vital that advisers can be confident in the risk taken by the solutions they recommend for their clients. Over the past three years since Vitality Funds were launched using the Dynamic Planner Risk Target Managed service, we have often heard from advisers how much they value the combination of the Gold badge, alongside the innovation of Vitality and their Risk Optimiser funds."
Neil Cowell, Head of UK Distribution, Vanguard said: “We’re delighted to be celebrating three years working with Vitality to bring value to investors. Vitality’s shared value model is an excellent fit with our client first philosophy. Through the Risk Optimiser range - powered by Vanguard’s high-quality, low-cost funds - Vitality’s combination of investments and wellness is a fresh and positive way to help clients achieve their financial goals.”
For more information on VIRO and other Vitality funds visit adviser.vitality.co.uk/investments
For further information, please contact:
Alexa Chaffer
Head of PR, Vitality
Notes to editors:
* Vitality offers plans with a Healthy Fee Saver which include:
1. Vitality Programme: automatic access to Select version of the Programme at no additional cost. The Programme helps clients take steps towards a healthier future - and rewards them with real financial benefits including reduced product charges.
2. Healthy Living Discount: we give your clients the opportunity to pay the lowest product charge in the market – zero – when they make healthy lifestyle choices.
3. Competitive fund charges: on all Vitality funds.