Looking to Diversify? Look No Further than This Multi-Asset ETF

With the Covid-19 pandemic still a wild card in the current market landscape, diversifying through multi-asset exposure is still important. Assets like the Invesco Growth Multi-Asset Allocation ETF (PSMG)  can help. PSMG also has a growth component built into the fund.

Source: Looking to Diversify? Look No Further than This Multi-Asset ETF

Its holdings include a mix of exposure from traditional equities, bonds, and international assets. So far in 2021, the fund is up over 10%.

Summarily, the goal of PSMG is to provide long-term capital appreciation by allocating through a growth investment style that seeks to maximize diversification potential. In essence, PSMG is a “fund of funds,” meaning that it invests its assets in the shares of other ETFs as opposed to securities of individual companies.

Per the fund’s description, here is a breakdown of its target allocation of total assets:

• 65%-95% in equity ETFs
• 5%-35% in fixed income ETFs
• 15%-35% in underlying ETFs that invest in foreign stocks and bonds as well as American depositary receipts (ADRs) and global depositary receipts (GDRs)

Invesco Advisers Inc. selects investments based on quantitative and qualitative criteria to strategically allocate across broad asset classes and factors within those classes. By using a filter of both quantitative and qualitative filters, ETF investors can have peace of mind knowing that the fund has quality investments.

PSMG’s total expense ratio comes in at 0.36%, which falls below its categorical average of 0.52%, according to Original Postrofile?p=PSMG" target="_blank" rel="noreferrer noopener">Yahoo! Finance.

Why a Multi-Asset Strategy?

From tangible assets like real estate to digital assets like Bitcoin, investors have a plethora of options to consider for exposure to markets that are uncorrelated to traditional stock market exposure.

“The flexible nature of many multi-asset strategies allows for a shift away from specific market- and benchmark-driven performance to more absolute return and other outcome-oriented solutions that strive for greater control over risk exposures,” said David Millar, head of multi-asset at Invesco, in a Pensions & Investments article. “A major advantage of these strategies is that they offer a way to increase potential portfolio risk efficiency with greater liquidity, transparency and cost efficiency compared to other popular alternative investment strategies such as hedge fund, private equity and venture capital investments.”

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