Morgan Stanley Investment Management (MSIM) has benefited from its performance and innovation in winning the multi-asset manager of the year award.

The manager's Global Balanced Risk Control (GBaR) strategy is closely aligned with the dynamic objectives of insurers. That means, it has a starting point of a risk target, volatility or value-at-risk (VaR), rather than a traditional index benchmark. It also shows itself in the innovative ways the team has worked to include Solvency Capital Requirement (SCR) constraints in GBaR portfolios.

The SCR in question is highly dependent on a portfolio's asset mix and appropriate management of this asset mix is essential to avoid volatility for the insurer's balance sheet. Having a customised SCR management gives flexibility to the investment manager's allocation range.

MSIM's team anticipates changes in volatility and determine to what degree the efficient frontier based on two years' historical data should shift to reflect expectations for lower/higher volatility in the near future, at typically one to three months.

This aspect is consistent with the objectives of many insurers, who are seeking to optimise the trade-off between return and SCR.

As of 31 October 2022, GBaR managed £3.2bn for European insurers and £5.4bn for insurance clients globally.