It has been a difficult time for property and real asset investment trusts since the mini-Budget in the UK, but Hawksmoor was able to sell a good chunk of its exposure before the sell-off.

Ben Mackie, fund manager at Hawksmoor Investment Management, discussed why the firm decided to sell out of real assets and which funds it sold. He also revealed what the firm held onto and why, including private equity trusts.

Mackie said that although real assets have an important part to play in a multi-asset portfolio, the current risk-reward payoff has made them less attractive.  

‘There are plenty of real assets that can deliver 8-10% total returns in a fairly non-economically sensitive way,’ he said.

‘But that isn’t so attractive when you can buy investment grade credit funds yielding more than 10%. We need to be paid a liquidity premium for owning real assets, and currently we can achieve similar returns from vanilla credit.’