Strategies

Balanced Risk Allocation Strategy

Investment strategy overview

The Invesco Balanced Risk Allocation (IBRA) Strategy aims to achieve a positive total return over a market cycle with a low to moderate correlation to traditional financial market indices, targeting a gross return of 6% p.a. above the Bloomberg Ausbond Bank Bill Index with 8% p.a. target portfolio volatility.

With approximately US$18 billion assets under management, the Strategy has been managed by Invesco’s Global Asset Allocation team based in Atlanta and Houston in the USA, and Frankfurt in Germany since 2008. The team has 17 members – all of whom bring a diverse mix of experience. The team is collectively responsible for investment strategy, asset allocation, portfolio construction, research, and security selection

The Global Asset Allocation team believes in building a portfolio based on a ‘Balanced Risk Allocation’ which is a technique that diversifies across purpose-built macro factors, being Real Return, Growth and Defensive, thereby seeking steadier returns over time. 

The goal of this approach is to avoid becoming overly reliant on one particular asset class or macro factor to drive returns. The outcomes of a ‘balanced risk’ approach could allow for a potentially smoother pattern of returns through the economic cycle. The portfolio aims to be better diversified for a wider range of economic environments. This, in turn, can create a more resilient approach to navigating through an economic cycle.

Key facts

Strategy inception

Sep 2008

Name of investment team

Invesco Global Strategies

Location of investment team

Henley-on-Thames, UK