The last week has seen the usual batch of fund launches, closures and managers moves, so to round up the past few days’ events we’ve summarised the biggest stories below.
Majedie UK Income soft-closes after hitting capacity
Majedie Asset Management has moved to restrict inflows into its top-performing UK equity income fund after the strategy reached its maximum capacity of £1.5bn.
The five FE Crown-rated Majedie UK Income fund, which is run by FE Alpha Manager Chris Reid with Mike Totton and Yuri Khodjamirian as co-managers, will not seek to establish any new client relationships although existing investors in the fund will be able to add to their mandates on request.
Rob Harris, chief executive of Majedie, said: “For over a decade we have committed to limiting capacity in our various strategies to allow for unconstrained decision making and to protect performance, which can suffer when funds grow too large.”
“It is of course a tribute to the UK Income team’s hard work that the fund has attracted such strong investor support and they can now concentrate on continuing to deliver for existing clients.”
Performance of fund vs sector and index since launch
Source: FE Analytics
Since inception in December 2011, Majedie UK Income has been the fifth highest returning fund in the IA UK Equity Income sector after gaining 102.20 per cent – far more than the rise in its average peer and its FTSE All Share benchmark.
Earlier in the week, FE Trustnet looked at three funds that could be alternatives for investors who missed their chance to invest in the Majedie offering.
HSBC makes fresh fee cuts to index trackers
HSBC Global Asset Management has more than halved the ongoing charges figures (OCF) on three of its most popular trackers, as fees in the passive space continue to shift downwards.
From 16 November 2015, the OCF on the HSBC American Index fund will be 0.08 per cent, HSBC European Index’s will fall to 0.10 per cent and HSBC FTSE All-Share Index will drop to 0.07 per cent.
Andy Clark, chief executive Officer, HSBC Global Asset Management (UK), commented: “We believe that passive investing is a growth area in the UK and we have always been at the forefront of its development. We have reduced fees on three of our core tracker funds that give investors exposure to the world’s key developed markets – the US, Europe and the UK.”
“Passive investing is a big and expanding market in the UK and as a fund provider we are committed to playing a part in this expansion.”
Index tracking providers have been increasingly dropping their fees over recent years. Last month, Fidelity Worldwide Investment reduced the ongoing charges of its UK, US, Emerging Markets and World index funds for users of its FundsNetwork adviser platform and certain wholesale clients.
Quilter Cheviot names head of fund research
Nick Wood has been promoted to head of fund research at Quilter Cheviot, following the creation of a combined multi-asset division with Old Mutual Global Investors.
He takes over the role from Ben Mountain, who was recently appointed to run the £9.5bn multi-asset investment solutions unit alongside Anthony Gillham. Wood will head up an eight-strong team that looks after fund manager research and third-party manager investments, covering open and closed-ended funds.
Quilter Cheviot chief executive David Loudon said: “Nick is a highly experienced investment leader, his know-how will enable him to expertly lead a highly skilled and knowledgeable team. We are confident that under his leadership the fund research team will make a first class contribution to our investment proposition.”
BlackRock unveils global impact equity fund
BlackRock has launched a UCITS fund for investors seeking exposure to companies with a positive measurable societal impact, with a risk/return framework.
The BlackRock Strategic Funds Impact World Equity fund is run by the asset management house’s Scientific Active Equity (SAE) team, which will use systematic and quantitative techniques to score 8,000 stocks on three areas of societal impact: health, the environment and corporate citizenship.
Jeff Shen, co-head of BlackRock’s SAE Investment Group, said: “This new investment strategy will help move impact investing from a niche to a core allocation.”
“We have designed a portfolio that combines innovative investing capabilities with a transparent and tangible set of social and environmental impact outcomes.”
Barings to close Emerging Opportunities fund
Baring Asset Management plans to close its Emerging Opportunities fund as its current size of $3m means the product is “uneconomical” to run.
The Dublin-domiciled fund, which is managed by Isabelle Irish, Jean-Louis Scandella and William Palmer, was launched in 2003 and has made a total return of 168.11 per cent, underperforming both its average offshore peer and its MSCI Emerging Markets benchmark.
Performance of fund vs sector and index since launch
Source: FE Analytics
In a letter to shareholders, Barings said: “Where a fund has a small asset size the cost and charges of running the fund become higher in percentage terms which reduces potential for growth. We consider the impact of these and charges would significantly reduce the expected net returns of the fund.”