Columbia Management this week launched the Columbia Risk Allocation Fund (CRAAX). The fund is managed by Todd White and co-managers Anwiti Bahuguna, Fred Copper, Kent Peterson, and Beth Vanney.
In a traditional balanced fund with an allocation of 60% stocks and 40% bonds, stocks can account for nearly 90% of the portfolio’s volatility, according to Colin Moore, chief investment officer. The Columbia Risk Allocation Fund seeks a different risk/return profile by allocating similar amounts of risk (measured as expected volatility) across stocks, fixed income securities and inflation-hedging assets.
“A growing number of financial advisors have begun to acknowledge that the conventional balanced portfolio is not truly diversified,” stated Moore. “Our process seeks to ensure diversification by balancing risk across asset classes that may respond differently under various economic and market environments.”
Columbia Management is a subsidiary of Ameriprise Financial, Inc. and managed from $344 billion in assets as of March 31.