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Providing a healthy hedge against risk

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While diversified instruments such as provident funds may not shine brightest during times of plenty, the current crisis in equity markets underscores the role of balance within an investment portfolio.

To that end, provident funds provide for the future by creating a healthy hedge against risk elsewhere.

Nick Crouch, vice-president, provident funds at Manulife (International), said it was in times like these that the appeal of a broad-based fund came into sharp focus.

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'It's through diversification that the provident fund provides a hedge against the markets. Despite the recent activity, for instance, bond funds haven't been swinging around anywhere near where the equities have been,' he said.

Manulife (International) markets a series of broadly diverse funds under the product name Manuflex.

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Mr Crouch defined Manuflex as 'a single product which offers lots of flexibility and choice'.

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