London, 18th January 2010 - Baring Asset Management (Barings) today announces that its flagship institutional multi-asset offering, the Baring Dynamic Asset Allocation Fund (DAA Fund), has grown to over £1.7 billion[1] in the three years since it launched on 17 January 2007.

According to year-end performance figures the DAA Fund has produced a cumulative return of 23.7%[2] since its launch in January 2007. This compares to the FTSE All Share which has returned -3.89%[2] over the same period. 

Over 2009 the Fund has attracted 26 new mandates worth over £536 million[3]. This brings the total number of clients invested to over 50.  Pension funds invested in the fund include Fiat Common Investment Fund, Oxford University Press, Nuffield Health, Times Warner and MGM Pension Scheme.

Kevin Frisby, Partner at Lane Clark and Peacock LLP, comments: "Interest in multi asset "Diversified Growth Funds", such as the Baring Dynamic Asset Allocation Fund, has mushroomed over the last 3 years amongst our pension fund clients - for both DB and increasingly for DC arrangements. The prospect offered by these funds, namely for equity type returns with significantly lower risk, is a compelling combination for many."

The Dynamic Asset Allocation Fund aims to deliver equity-like returns with less risk than holding an equity-only portfolio.  Its ability to move quickly and take advantage of tactical asset allocation opportunities has accounted for much of its success since launch.  For example, in anticipation of the impending financial crisis in 2007 the fund began reducing its exposure to equities and increased its commitment to short-dated bonds, gold and cash.  However, in the final quarter of 2008 the DAA started to move back into equities and capitalised on last year’s rally. More recently, risk assets have been trimmed again, with profit taking in equities and corporate bonds.

The Fund owes much of its success to its long standing Multi-Asset team, brought together in 2001 by Percival Stanion, head of asset allocation.  The team now includes eight investment managers, who average over 20 years of investment experience, and one analyst.     

Commenting on the performance of the DAA Fund and the outlook for 2010, Percival Stanion, head of asset allocation at Baring Asset Management said: “The fast accumulation of assets under management reflects the DAA Fund’s growing reputation amongst pension schemes, which are attracted to our dynamic asset allocation approach and a desire to preserve capital whilst also capturing returns.  Over the past year our tactical asset allocation decisions have resulted in being well positioned to benefit from the surge in UK, emerging market and Asian equities and we captured significant returns from the gold bullion. But as equities and corporate bonds have shown signs of running out of steam we have increasingly taken risk off the table.     “Markets are no longer undervalued and so we expect that earnings growth will drive performance. For this reason, high quality stocks should fare much better.  On a sector basis we’re looking at opportunities in UK commercial property, which is offering inflation-hedged returns of 5-6% as well as long term capital growth. ”

Baring Dynamic Asset Allocation performance since launch in 2007[4]

Year  Accumulated performance since inception  Annualised performance since inception FTSE All Share accumulated performance Funds under management At 31 Dec 2007 +8.9%      + 8.9%     + 5.4%     £360m (as at 31 Dec 07) At 31 Dec 2008 +2.94%      +1.49%     - 26.13%    £1.029bn (as at 31 Dec 08) At 31 Dec 2009 +23.76%      +7.48%     -3.89     £1.742bn (as at 31 Dec 09)

Notes to editors [1]Source: Baring Asset Management as at 13 January 2010 [2]Source: Baring Asset Management. Accumulative performance figures since inception (16 January 2007), net of fees, as at 31 December 2009 [3]Source: Baring Asset Management as at 31 December 2009 [4]Source: All performance Baring Asset Management as at date stated, net of fees