MLC investment approach

When we introduced the multi-manager approach to investing in 1985, we transformed the way Australians invest.

And, more than 20 years later, we’re still the preferred multi-manager for Australians.

This is because we design investment solutions which help investors achieve their goals, and also help manage risk.

To do this we apply our five principles of investing, in our multi-manager portfolios:

1. The best way to grow wealth is to use excellent investment managers to find the best investments
   We use investment managers who have a competitive edge, can clearly articulate their investment beliefs and have the resources to build excellent portfolios. We also ask our managers to build portfolios that reflect their best ideas. This allows them to be the best they can be.
   Details of MLC's current investment managers.
2. Extensive research is the only reliable way to identify excellent investment managers and build robust strategies
   Brand and past returns are not reliable ways of identifying managers who will provide strong returns in the future. That's why we research hundreds of investment managers from around the world.
3. A long-term approach should be used to achieve long-term financial goals
   We know reacting to short-term market movements is usually wealth destroying. That's why we're disciplined in applying a long-term view when we make decisions.
4. Sensible diversification reduces risk
   Our portfolios are diversified in three important ways:
   • Across asset classes. Each asset class performs differently in different circumstances. By investing in a mix of asset classes, the effect of the ups and downs of each asset class’s return is smoothed for the overall portfolio.
   • Within asset classes. We invest across a broad range of countries, currencies, industries and companies.
   • Across investment managers. By combining managers with different investment approaches we can generate more consistent returns than a single manager approach.
5. Efficient implementation reduces costs and taxes
   We carefully manage cash flows and strategy changes within our portfolios to avoid unnecessary tax and costs.

Our multi-manager approach aims to grow your wealth for a given level of volatility.
When markets are weak and returns are negative, we aim to do better than comparable funds.
When markets are very strong we keep focussed on meeting your long-term goals, rather than chasing risky returns. This may temporarily result in a lower return than comparable funds that do.
By reducing the extent of the ups and downs, returns are smoother.