What is the Managed Volatility Process?
To help members who want investment growth but have less tolerance to significant market movements, the Fund offers an optional feature known as the ‘Managed Volatility Process’ (MVP). The MVP is a feature you can add on the Growth option, and it’s also embedded in the Moderate option. The MVP aims to provide a smoother investment journey during periods of extreme market volatility.
The underlying investments of the Growth option are still the same, but the MVP is an overlay that places more emphasis on managing volatility. The MVP is designed to more actively manage risk during periods of extreme market volatility.
While the MVP can reduce the impact of downside risk, it can also reduce the height of upside results. All investments carry a degree of risk, and risk can never be completely eliminated without giving up some potential return. It’s important to note that the MVP is not expected to address cyclical or random drops in the markets, rather it is a process that kicks in during an extreme market event similar to the Global Financial Crisis.
To learn more about the MVP read our Investment Supplement.