Spotlight on March: Fund Industry Latest

iShares expands its range of ESG-focused ETFs, and there are new launches from Comgest and Man GLG in the latest round-up of fund industry news

Holly Black 31 March, 2020 | 10:56AM
Facebook Twitter LinkedIn

spotlight

While stock markets across the world endured their worst falls in years, there was plenty happening across the funds industry in March.

Comgest launched a Growth Emerging Markets Fossil Fuel Free fund at the start of the month. The fund was started with seed capital from four institutional investors: the National Trust, the Joseph Rowntree Foundation, Guardian Media Group, and the Nesta Trust.

Comgest said the fund had been launched in response to growing demand for options which apply ethical exclusions, and particularly a zero-tolerance approach to fossil fuels. The fund house is well known for its emerging market investment capabilities; its Comgest Growth Emerging Markets fund has a Gold Morningstar Analyst Rating, and Comgest Growth India is rated Silver. 

Man GLG, meanwhile, launched the US Absolute Alpha fund, to be managed by Mike Corcell and Alex Robarts. The fund will take a long/short approach to US equities, meaning it can short – or bet against – stocks the managers believe will fall, as well as investing in those they expect to grow. It will focus on three key areas in selecting stocks – investment cycles, changing themes, and secular trends – to build a portfolio of around 60 to 70 holdings.

Sustainability in the Spotlight

BlackRock expanded its range of iShares exchange-traded funds which take into account environmental, social and governance (ESG) factors. Earlier this year, BlackRock’s chief executive Larry Fink pledged to put sustainability at the heart of the firm’s investment process. 

BlackRock said sustainable ETFs across the world attracted $5.7 billion of new investment in February alone. It has now committed to doubling its offering of ESG ETFs by the end of 2021, including creating sustainable equivalents of some of its flagship tracker funds.

Three new launches include iShares MSCI EMU SRI UCITS ETF (SMUA), which will track EU companies with the best ESG scores, iShares $ Corp Bond ESG UCITS ETF (SUOU), which invests in investment grade corporate bonds with high ESG ratings, and iShares Smart City Infrastructure UCITS ETF (CITY), which aims to tap into opportunities in “smart megacities”.
The funds charge 0.2%, 0.15% and 0.4% respectively.

Sustainability was also on agenda at Lombard Odier, which has launched a Climate Transition strategy. It will aim to invest in companies positioned to generate growth and increase their market share, which provide solutions to reduce carbon emissions. Investments will include businesses involved in energy efficiency and renewable energy projects, for example, as well as those building more resilient infrastructure. The fund will be managed by Paul Udall and Francois Meunier; Udall has experience in sustainable investing while Meunier specialises in technological innovation.

Fidelity is to change the name of its European Values (FEV) investment trust to the Fidelity European Trust. The trust has a Silver Morningstar Analyst Rating and has delivered annualised returns of 8.8% over 10 years. Fidelity said the name change would better reflect the trust’s investment objective. Morningstar analyst Bhavik Parekh rates the trust’s experienced manager Sam Morse with “the backing of a well-resourced team, and consistent and measured application of an established investment process”.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Facebook Twitter LinkedIn

About Author

Holly Black  is Senior Editor, Morningstar.co.uk