By Cyril Tuohy
Monument Advisor, the flat-fee variable annuity offered by Jefferson National Life, has added 23 new investment options to its fund lineup to help advisors manage risk and volatility, Jefferson National has announced.
The latest additions include 14 investment funds from American Funds, six asset allocation funds from SEI, Federated Managed Tail Risk Fund II, Goldman Sachs Variable Insurance Trust Global Markets Navigator Fund and Gold Bullion Strategy Portfolio from Advisors Preferred Trust
Five of the 14 American Funds utilize a “Milliman hedge” to manage portfolio volatility, the company also said.
“Clearly, the combination of tax deferral, low cost and an unsurpassed selection of funds is key to manage risk, hedge against volatility and build more resilient client portfolios in today’s turbulent market,” Jefferson National chief operating officer David Lau said in a statement.
Jefferson National Life Insurance Co. is the life insurance subsidiary of Jefferson National Financial Corp., which distributes financial products through a network of 2,000 registered investment advisors (RIAs) and fee-based advisors around the country.
More funds were added to the Monument Advisor VA family in response to demand from registered investment advisors and fee-based advisors, the company said. Earlier this year, Jefferson reported more than $20 billion in VA sales over the past 20 months.
Insurance companies have been adding new, “alternative investment” funds for their advisors to help them improve returns as interest rates are still very low by historical standards. Alternative investment funds invest in commodities and precious metals as opposed to traditional investments of stocks, bonds and cash.
Recent surveys conducted by Jefferson have found that over the past five years, as many as 64 percent of advisors have increased their use of alternative investments. As many as 55 percent of advisors also said they would increase their allocation to alternative investments, as well.
A total of 76 percent of advisors said they would consider increasing the use of alternative investments if they could access them in a low-cost, tax-deferred account, the survey also found.
Many advisors want higher yields out of their clients’ portfolios. While some experts have forecast a rise in interest rates beginning in 2014, few advisors are betting on it. So that leaves advisors looking to alternative investments.
Jefferson advisors have more than 400 funds from which to choose, including 75 alternative investment options, the company also said.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].
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