September Fund Launches Feature Terry Smith and Mark Mobius

NEWS YOU CAN USE: This month saw a wave of new funds and more details about two major investment trust launches from star managers  

Emma Simon 26 September, 2018 | 2:48PM
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Terry Smith

Star fund managers can still attract investors’ attention. This month two managers with enviable track records announced plans to launch their own investment trusts. And both are putting their own money into these new ventures.

Terry Smith – arguably one of the most successful fund managers of the last five years – is hoping to raise £250 million with the launch of his global small and mid-cap trust, which will follow a similar strategy to his Gold-rated Fundsmith Equity fund. Veteran emerging market manager, Mark Mobius is launching his new emerging market investment trust focused on smaller and mid-cap companies.

Elsewhere, there have been a wave of OEIC and ETF launches, many based on thematic investing. BlackRock has added to its megatrends range while Invesco has expanded its US sector range. Meanwhile Amundi becomes the latest investment house to launch its own artificial intelligence fund.

Although it remains to be seen whether investors prefer to back AI solutions when it comes to their own money, rather than the judgement of a human fund manager with a proven track record.

Star Fund Manager Invests £25m Into New Trust

Fundsmith is looking to raise £250 million for the launch of a new investment trust.

The investment house, set up by Terry Smith, has seen buoyant returns and strong sales on its gold-rated flagship fund, Fundsmith Equity. Smith says he will invest £25 million of his own money into this new Smithson Investment Trust, which will invest in global small and mid-cap companies. These are smaller than the companies in the Fundsmith equity fund.

The trust will be overseen by Smith, but the investment team will be led by Simon Barnard as investment manager, with Will Morgan as assistant manager.

The pair were hired last year from Goldman Sachs to research the opportunities presented by applying the Fundsmith process to a portfolio comprised of smaller companies.

Mobius Launches Investment Trust

Mobius Capital Partners is listing its new investment trust on the stock market in October.

The Mobius Investment Trust will focus on smaller and mid-cap companies in the emerging markets sector with potential to improve their environmental, social and governance records. It is hoped this will act as a catalyst for wider operational and financial improvements.

The founding partners, Mark Mobius, Carlos Hardenberg and Greg Konieczny will run the trust and will participate in the IPO with some £5.7 million according to the company’s statement.

The trust’s annual management fee was set at 1%, reducing to 0.85% above £500 million and 0.75% above £1 billion.

The trust will target a total return of between 12% and 15% a year over the longer term.

BlackRock Expands ‘Megatrend’ Funds

BlackRock has expanded its range of thematic funds, that attempt to capture global ‘megatrends’.

Its latest offerings include the BGF Future of Transport fund, which will focus on companies that generate revenues from growing are of electric vehicles and driverless or digitally-connected transportation.

The company has also launched a BGF Next Generation Technology fund which will focus on AI and robotics and a BGF FinTech fund. As the name suggests this latter fund focuses on companies that are applying technology to the financial services sector.

These three funds will all be actively managed, but BlackRock has also added to its range of thematic ETFs. This includes the launch of its iShares Digital Security fund (LOCK), tracking the STOXX Global Digital Security Index.

It has also launched a new Inclusion and Diversity ETF (OPEN), which tracks an index compiled by Thomson Reuters. This index assesses 6,000 global listed companies, and ranks them on four key metrics: diversity, inclusion, people development and “news and controversies”.

The fund will include the 100 companies with the highest scores. The company says it believes this index embraces “a broader spectrum of diversity dimensions”, than comparable indices in this segment, which focus more narrowly on gender.

Invesco Expands US Sector Range

Invesco has launched a new ETF which will focus on the communications sector. This UCITS EFT will be listed on the LSE and will have ongoing charges of 0.14%. It will track the S&P Select Sector Capped 20% Communication Services Index. This is Invesco’s eleventh US sector ETF to be available in Europe. This new sector has 26 stocks in it, and is aimed at extending the traditional telecommunications sector, to cover companies involved in various digital technologies.

Amundi Launches AI ETF

Amundi is the latest fund manager to launch an AI-themed investment vehicle. This is an ETF which will track the STOXX AI Global Artificial Intelligence ADTV5 index. The ETF will have an ongoing charge of 0.35%.

In recent months there have been a spate of fund launches focused on the growing sector of robotics and AI. Some of these follow passive strategies, others are more actively managed funds.

The managing director of Amundi ETF, Fannie Wurtz says this product offered a “cost-efficient” way to gain exposure to AI, which she says should be a key driver of future growth.

Hawksmoor Launches Global Opportunities Fund

Hawksmoor Fund Managers launched a new global opportunities fund in September. This builds on the track record of the company’s Vanbrugh Fund and will sit in the Investment Association’s flexible investment sector. It will target investors with a higher tolerance of risk.

The fund will be managed by Daniel Lockyer and Ben Conway. Hawksmoor says its existing funds were often used as core holdings in lower risk portfolios, so it was looking to add other options for higher risk investors.

It added it also wanted to take advantage of “some interesting long-term structural growth themes” that can only be incorporated in significant size within a fund that can tolerate shorter-term bouts of volatility.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Fundsmith Equity I Acc6.99 GBP-0.15Rating
iShares Digital Security ETF USD Acc7.46 USD0.50Rating
iShares Refinitiv Inclusion & Divst ETF7.47 USD0.62Rating

About Author

Emma Simon

Emma Simon  is a financial journalist, specialising in investment and consumer issues, writing for

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