Omnis Investments work with The Penny Group to help you achieve your long-term financial goals through trusted advice.

We do this in four key steps:

1. Financial planning - Based on your conversations, your financial adviser will align you a risk profile.

2. Strategic Asset Allocation - For every risk profile, we confirm the long-term mix of assets that aim to deliver the best return with the appropriate level of risk.

3. Tactical Asset Allocation - Once the strategic Asset Allocation is set, we will tactically manage the portfolio to take advantage of short-term opportunities.

4. Manager selection - We select experienced managers to make decisions on what specific companies and bonds to invest in.

What is Strategic Asset Allocation?

Strategic Asset Allocation (SAA) is the long-term allocation of asset classes in a portfolio based on an investor’s risk tolerance, capacity for loss, investment goals and time horizon. It involves analysing, selecting and weighting different asset classes (such as shares, bonds and alternatives) according to certain return and risk profiles.

The purpose of SAA is to create a diversified portfolio that performs in line with your investment objectives and attitude to risk by balancing the unique risk and return characteristics of different asset classes. It is important that the portfolio you invest in has the most appropriate SAA, as this will be the dominant driver of your returns over the long term.

Why is Strategic Asset Allocation important?

SAA is crucial to the investment process. The performance of different asset classes can vary depending on economic conditions, so a robust SAA can optimise returns and adhere to your risk profile by balancing volatile assets with more stable ones.

We review our SAA framework annually with the trusted support of J. P. Morgan Asset Management, one of our global research partners, to ensure it continues to align with your risk tolerance and time horizon.

How do we develop our SAA?

Our annual SAA review keeps our portfolios balanced and well positioned. We start by looking at long-term market forecasts developed by J. P. Morgan Asset Management. These forecasts predict how various asset classes might perform over a 10-15 year period, including their expected returns, risks and how they correlate with one another.

We use this data alongside expertise from our risk research partner, EV (formerly EValue) to design portfolios that align with these forecasts and your investment objectives. This ensures your portfolio operates within a level of risk that you’re comfortable taking.

EV (formerly EValue) is a UK-based financial technology company that provides research and tools to asset managers and financial planning firms. It combines actuarial knowledge with asset modelling and risk management to assess the risks underlying portfolios and forecast volatility journeys.

Why J. P. Morgan Asset Management

J. P. Morgan (JPM) Asset Management is a leading provider of Long-Term Capital Market Assumptions (LTCMAs) because of its robust research capabilities deep market insights and experienced team of investment professionals.

It leverages extensive historical data and advanced analytical models to generate reliable, comprehensive projections across various asset classes. Its LTCMAs are built on a rigorous framework that incorporates multiple macroeconomic and geopolitical factors.

J. P. Morgan Asset Management’s expertise equips us with the insights we need to make informed decisions about SAA which are aligned with your long-term investment objectives.

Our 2025 SAA adjustments

The global economic landscape has shifted from the low investment, low growth and low interest rates of the 2010s to higher growth, significant capital investment and increased interest rates. Advancements in artificial intelligence and automation are likely to support increased productivity and economic growth, creating a positive outlook for asset markets despite persistent inflationary risks and market volatility.

Based on this outlook and JPM LTCMAs, we’ve made some changes to reduce the concentration of UK assets in favour of other global investment opportunities:

◊ We reduced UK equities by 25% in 2024. We’re reducing them even further in 2025 in favour of global equities.

◊ We’ve also reduced UK bonds (both government and corporate) in favour of global bonds.

We believe this will help to reduce single country risk with little to no effects on the long-term risk and return projections of your portfolio.

Here are the expected annual returns of your new Strategic Asset Allocation over the next 10-15 years:

Agile adjustment with Tactical Asset Allocation

We know that markets don’t move in a straight line which is why we maintain consistent oversight of your investments, adjusting allocations in the short term aiming to take advantage of opportunities on the upside and offer a degree of protection to your portfolio on the downside.

This is known as Tactical Asset Allocation (TAA) and it gives us the flexibility and control to ensure your money is always working hard towards your financial goals.

To learn more about our SAA framework, tactical asset allocation, and investment selection, please visit omnisinvestments.com or speak to your financial adviser.

What happens next?

We’ll gradually move the portfolio you are invested in towards the new SAA on your behalf; you don’t need to do anything. We’ll also provide detailed updates through your financial adviser as we make this transition.

The new SAA can be seen here

Omnis Investments

Issued by Omnis Investments Limited. This update reflects Omnis’ views at the time of writing and is subject to change. The document is for informational purposes only and is not investment advice. We recommend you discuss any investment decisions with your financial adviser. Omnis is unable to provide investment advice. Every effort is made to ensure the accuracy of the information, but no assurance or warranties are given.
Past performance should not be considered as a guide to future performance.

The value of your investment, and any income derived from it, may go down as well as up and you may not get back the full amount invested.

The Omnis Managed Investments ICVC and the Omnis Portfolio Investments ICVC are authorised Investment Companies with Variable Capital. The authorised corporate director of the Omnis Managed Investments ICVC and the Omnis Portfolio Investments ICVC is Omnis Investments Limited (Registered Address: Auckland House, Lydiard Fields, Swindon SN5 8UB) which is authorised and regulated by the Financial Conduct Authority.

You should not use past performance as a suggestion of future performance. It should not be the main or sole reason for making an investment decision.

Get in touch

Email info@thepennygroup.co.uk or call 0207 061 2345 if you have any questions or should you wish to speak to one of our advisers.

Strategic Asset Allocation: Explained