Removing a retiree’s obligation to buy an annuity has meant advisers have been looking to multi-asset products to provide retirement incomes for their clients.

Fund providers have responded by launching new multi-asset products or repackaging existing offerings for multi-asset-hungry investors.

One of the other main drivers of this trend towards multi-asset has been the rising need for income that, as no one needs reminding, has come about as a result of record-low interest rates.

Steven Andrew, manager of the M&G Episode Income fund, acknowledges: “It is no surprise income investing has been very fashionable in recent years. A combination of falling interest rates and pessimism over the global economic outlook has been a perfect environment for assets offering reliable income payouts.”

But with mounting speculation that the US Federal Reserve is set to start raising rates around September this year, could this be the end of rock-bottom interest rates?

Mr Andrew doesn’t think so. “Even if the fashion were to change, the structural forces that have driven the need for income investing as a strategy will likely persist for years to come,” he says.

“Demographic changes are boosting the army of those seeking income not from their labour, but from their investments. Fortunately there are plenty of income-bearing assets that still look attractive today.”

In fact, the multi-asset market has certainly received a lift in the past year.

The BlackRock Investor Pulse Adviser Survey found that advisers are suggesting to their clients that they diversify away from cash, while also encouraging them to increase positions in multi-asset (36 per cent).

Says Jeremy Roberts, head of UK retail sales at BlackRock: “Saving for retirement and working longer is clearly preying on the minds of British people, which is unsurprising given the new choices and control they now have over their pensions at retirement.”

Mark Rockliffe, head of intermediary sales at Heartwood Investment Management, observes: “The thing that multi-asset portfolios, if run well, should bring to bear is a smoother journey which has to be good for people in the decumulation phase.

“So I think that’s why you’re seeing much more popularity and questions about it from advisers and investors alike. They’re asking, ‘How do I have my money invested, take income, but not get destroyed if markets unfortunately have wobbles or difficult times?’”

The proliferation of multi-asset funds may be overwhelming to some but what it has done is create competition in the market. But for Mr Rockliffe, there is a need to ensure investors understand the definition of multi-asset.

He remarks: “The rise of multi-asset [means] we are seeing a lot of new entrants and maybe one of the challenges is being able to differentiate and help both the end investor and the adviser understand the technical differences between fund-of-fund products and true multi-asset portfolios.

“While it feels like it’s similar shades of the same colour, it definitely isn’t in terms of how these funds are run and that is one of the challenges the industry has to face up to.”

Ellie Duncan is deputy features editor at Investment Adviser