View a copy of the Investment Advisory Committee Terms of reference
We believe all investment options should be monitored on a regular basis and through strong governance we can help to ensure they deliver in line with their investment objectives.
That’s why all of our investment options have a formal review process, at no extra cost.
At the heart of this is our Independent Advisory Committee (IAC).
Find out more about our Governance Promise.
The IAC is made up of five pension and investment experts, three from the Royal London Group and two independent experts. They're committed to providing an ongoing formal review process for our investment proposition helping you deliver an ongoing, compliant service and peace of mind to your clients.
Meetings are held on a regular, usually quarterly basis to review our Governed Range and funds. The review process focuses on taking a long-term view to ensure investment decisions are made in our investor’s best interests and cover the following types of questions:
We understand that real governance needs to be transparent so you can see what action we’ve taken and why.
To help the committee to make these decisions, they review reports and market commentary from –
To find out more about our members download The Investment Advisory Committee leaflet.
We started the quarter firmly overweight in equities, having bought during weakness last quarter and benefitted from the sharp recovery. We slightly increased this position over the period, taking advantage of seasonal weakness in August.
Monetary policy is currently easing in the US, the euro area, China and a wide range of other developed and emerging economies. We think this economic cycle has further to run and stocks should continue to outperform bonds over the next year or two.
We started the year overweight in equities, having bought through weakness in the last quarter of 2018 and benefitted from the sharp recovery in Q1.
Having benefitted from the rebound in equity markets, we took some profits but remain overweight given the dovishness of major central banks and the signs that another mini cycle could drive stocks higher once better data feeds through.
Within equities, we increased our position in Europe from underweight to neutral following underperformance and the European Central Bank has now committed to easing monetary policy which should boost European equities in due course.
We also increased our overweight holding of US equities given relatively strong economic growth there. Against these increases, we remained broadly neutral in UK equities given risk that a ‘no-deal’ Brexit will hold back the economy, but equally a deal would bring an end to the unhelpful uncertainty.
We have sharply reduced our position in Japan from overweight to underweight, as the economy there continues to struggle, and cut our overweight in emerging markets, taking profits, following strong performance as the US dollar weakened on expectations of lower interest rates.
We started the quarter firmly overweight in equities, having bought equities through weakness in the last quarter, and benefitted from the sharp recovery in sentiment as investors shifted again to a ‘risk on’ attitude this year. This was driven by more benign interest rate rhetoric from leading central banks, including the Federal Reserve (Fed), which indicated the next hike in US interest rates could be delayed until 2020; and more positive expectations of the US-China trade talks.
Having benefitted from the rebound in equity markets, we scaled back our equity holdings and took profits, but remain moderately overweight as there are early signs of growth stabilising in China.
The overall position as at end March, was overweight Equities, High Yield and Corporate Bonds; underweight Absolute Return Strategies (inc. cash), Gilts and Commodities. Neutral positions were maintained across Property and Index Linked Bonds.
In our view, stock markets were premature to price in a US recession, and the recovery in equity prices has further to run. Longer term, we remain positive on stocks.
Within Equities, we have overweight’s in the US, Japan and emerging markets, with below benchmark allocations to the UK, continental Europe and Asia Pacific (excluding Japan).
Within the overweight Fixed Income allocation, we continued to favour sterling investment grade corporate bonds and short duration global high yield debt versus Gilts. Commodity exposure has been moved further underweight, and UK commercial property exposure kept around neutral.