Merryn Talks Money What Are Absolute Return Funds And Should You Invest In Them?
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Mar 18, 2026 They explain what absolute return funds aim to do and why targeting positive real returns appeals to investors. They contrast diverse strategies from hedge-fund styles to conservative multi-asset approaches. Discussion covers using these funds as portfolio ballast, what to check when choosing one, and the gap between targets and actual performance.
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What Absolute Return Funds Actually Aim For
- Absolute return funds aim to deliver positive real returns rather than beat an index.
- Merryn Somerset Webb explains they target making your money worth more in inflation‑adjusted terms over a period instead of relative outperformance.
Outperformance Can Still Mean Losses
- Most ordinary funds benchmark performance to an index, so 'outperforming' can still mean you lost money.
- John Stepek and Merryn show retail investors care about real capital preservation, not relative metrics when markets fall.
Investors Care About Real Purchasing Power
- Retail investors primarily want to preserve and grow purchasing power, not relative rankings.
- John Stepek emphasizes the end goal: consistent returns above inflation so retirees end up richer in real terms.