Client demand for a product that produces income as well as capital growth has accelerated the launch of a Credit Suisse multi asset income ...

Client demand for a product that produces income as well as capital growth has accelerated the launch of a Credit Suisse multi asset income portfolio. Although planned for launch next year, this segregated portfolio product run by the 16-strong multi asset class solutions team at Credit Suisse, has already attracted considerable interest from the bank’s private banking clients which include charities and other institutions. The portfolio is structured to target yields of 5.5 per cent income, which is either paid out or re-invested depending on the individual client requirements. Capital growth is met by asset allocation which is 80% growth assets - equities, property, structured products and hedge funds. A hedging layer for extra protection can be added by including put options against the equity exposure which reduces the expected distributable yield to 4 per cent. Michael Pinggera, director of portfolio management, private banking at Credit Suisse told WealthBriefing that all assets chosen globally, including equities, property, bonds, hedge funds and cash must yield. “The portfolio is throwing off a great deal of cash which meets our short-term needs, and ultimately gives us time for the investments made to mature which is where the capital growth comes from,” he said. “This portfolio has excited a great deal of interest in clients who have a short term need for cash but a long term desire for capital growth.” The portfolio is part of a range strategies offered by Credit Suisse, which includes core, satellite, and alpha plus modules. According to Mr. Pinggera, the alpha strategy is a stock picking model, combining best ideas and ETFs. “Our philosophy is to divorce individual picks from market or market sector exposure,” he said. “If one of our investment managers wants exposure to a sector or country they would use an index-based product, if they have a strong view on an individual company they can invest. This way we can focus on fewer, better researched ideas and isolate them from general market exposure.” Credit Suisse’s minimum threshold for private banking clients is usually £1 million and the bank charges 1 per cent payable quarterly in arrears.