Risk profile: Medium
Management type: Flexible with VaR
Annual return target: 3-6% per annum*
Time horizon on the line: at least 3 years
Risk: average of the last 52 weekly VaR readings, maximum 6% with a time horizon of 1 month and 95% confidence interval

The management line aims to achieve a positive absolute return over a predefined time horizon and to outperform the rate of return of risk-free financial instruments, irrespective of Benchmark constraints and regardless of market movements; it also aims to limit any negative fluctuations in the portfolio.

To this end, the line adopts diversified asset allocation criteria and invests mainly in instruments that offer a favourable risk/return ratio, containing the directional risk of the markets. A key part of the strategy, in addition to the underlying economic vision, is the selection of excellent Fund managers in their respective areas of expertise.

The line includes a substantial bond component (indicatively between 30 and 60%, depending on macroeconomic variables, interest rates and market conditions), invested in various market sectors mainly through collective instruments such as OICRs and possibly ETFs and only residually in individual bonds, where value can be found, also in order to limit the risk for the client.

A second significant component comprises flexible OICRs (10-40%) with an excellent track record in various market conditions, and a third part, more closely linked to market directionality, comprises equity OICRs and ETFs (0-30%), with a particular focus on market sectors and/or geographic areas with good growth prospects. In some cases, individual equities may be included, where there is an in-depth view of the development potential of the companies in question, for percentages that are in any case small.

Finally, a portion (0-20%) may be invested in investment certificates, chosen through an ad hoc developed database, which present advantageous return characteristics with respect to the risk of the underlyings. Occasionally, financial instruments linked to precious metals may be included, and only very marginally in other commodities.

The strategic positioning of the line is based on the evaluations of the internal investment committee, which is held monthly or even more frequently when circumstances require it, and is implemented through collective investment instruments, while positions in individual securities and those in certificates represent more tactical choices.

The portion invested in foreign currencies generally represents a relative share of the portfolio (0-30% and mainly in US dollars, except in special circumstances).

*The annual return targets of the investment lines are only forecasts and are not to be interpreted as minimum returns and/or guaranteed returns.