UK digital wealth manager Nutmeg has introduced a trio of ETF-based thematic investment portfolios, each providing investors with exposure to multiple long-term secular trends.
James McManus, Chief Investment Officer at Nutmeg.
The three portfolios, which are actively managed by Nutmeg’s investment team, are represented and branded by their overarching theme: Technological Innovation, Resource Transformation, and Evolving Consumer.
Each portfolio consists of a mix of ETFs that target sub-themes aligned with the overarching theme, alongside a globally diversified range of ETFs that are not theme-specific.
The level of exposure to thematic ETFs within a portfolio is contingent on the risk tolerance of the investor. Specifically, portfolios at a risk level of ‘5’ will allocate 10% to thematic ETFs, while those at a risk level of ‘10’ — the maximum available — will cap thematic exposure at 20% of the overall portfolio.
The three future-focused themes available for selection offer distinct market opportunities. Technological Innovation targets sectors like robotics, automation, cloud computing, cybersecurity, and artificial intelligence. Resource Transformation focuses on the evolution of energy sources, the materials required for electrification, and the increasing global demand for clean water. Evolving Consumer, meanwhile, provides exposure to digital products and services, changing healthcare needs due to aging populations, and the expanding wealth of consumers in emerging markets.
Nutmeg charges a fee of 0.75% on the first £100,000 invested within its thematic portfolios and 0.35% on any amount beyond.
Commenting on the new investment offering, James McManus, Chief Investment Officer at Nutmeg, said: “Our thematic investment portfolios have been designed to provide customers with an opportunity to invest in those long-term trends that are shaping society and the economy, while also benefiting from a globally diversified approach. As thematic investing becomes increasingly popular among investors, our aim is to offer customers a new way of investing with Nutmeg that helps get them closer to achieving their financial goals.
“At Nutmeg, our mission has always been to make investing and wealth management more accessible, by bringing innovative, technology-led solutions to more people. The suite of thematic investment portfolios gives investors access to the emerging and prevailing investment trends, with the reassurance their portfolio is managed by a team of experts, at a price that isn’t prohibitive.”
Nutmeg’s offering of thematic portfolios represents the firm’s fifth distinct investment style on offer, joining its Fully Managed, Smart Alpha, Socially Responsible, and Fixed Allocation portfolios.
The Fully Managed portfolios are the firm’s flagship product, proactively managed by Nutmeg’s in-house team who regularly make strategic adjustments to try and protect against losses and boost returns. Smart Alpha, created in collaboration with JP Morgan Asset Management, offers active security selection based on market research. The Socially Responsible portfolios prioritize environmental, social, and governance considerations. Lastly, the Fixed Allocation portfolios are designed to operate with minimal intervention and are thus reviewed only annually.