Fund Times: 15 - 19 June
Vanguard launches low cost index trackers in the UK; Jupiter Asset Management launches a Japanese fund; Standard Life hires BlackRock analyst; Cazenove to launch UK Equity fund; Gartmore to replace Roger Guy on two funds; Morningstar qualitative ratings and reports issued this week.
Vanguard launches low cost index trackers in the UK
Vanguard Investments, the leading provider of low cost funds in the US, is launching a range of 11 low cost index trackers in the UK on the 23rd June. The funds being launched both UK and Irish domiciled, with the UK ones being Vanguard FTSE UK Equity Index Fund, Vanguard FTSE UK Equity Income Index Fund, Vanguard FTSE Developed World ex-UK Equity Index Fund, Vanguard FTSE Developed Europe ex UK Equity Index Fund, Vanguard US Equity Index Fund. The Ireland- domiciled funds will also be available to UK investors, and might have some tax advantages. They are the Vanguard Japan Stock Index Fund, Vanguard Pacific ex- Japan Stock Index Fund, Vanguard Emerging Markets Stock Index Fund, Vanguard UK Investment Grade Bond Index Fund, Vanguard UK Government Bond Index Fund and Vanguard Global Bond Index Fund.
The TERs across the range are low, with the highest being the Emerging Markets Stock Index tracker at 0.55%. This is significantly cheaper than other index tracker providers in the UK. Vanguard is very transparent in disclosing all charges its fundholders pay, something it is well known for in the US, but uncommon here. To read more on the upcoming launch, as well as to view a full list of TERs of the funds being launched, click here.
Jupiter Asset Management launches a Japanese fund
Jupiter Asset Management is to launch a Japanese equity fund in July. The Jupiter Japan Select fund will focus on small and medium sized Japanese companies, and contain between 40 and 55 holdings. It will be managed by Simon Somerville, who joined Jupiter in January 2005 and also manages the Jupiter Japan Income fund. The fund will be allowed to invest up to 20% in other Asian countries, and will be able to hold government bonds as well.
Standard Life hires BlackRock analyst
Standard Life Investments has hired Andrew Fraser, formerly of BlackRock, as a senior credit analyst in financials. Fraser, who has 18 years’ experience, will be helping with improving Standard Life’s counterparty monitoring process. This addition to the team is timely, as they have also announced the promotion of Erlend Lochen, manager of the Standard Life European High Yield fund to Head of Global High Yield. As a result, Lochen will be re-locating to Boston, and will take on the responsibility for expanding Standard Life’s high yield and investment grade capabilities there. Standard Life plans to eventually launch a Global High Yield fund, and potentially add global capabilities to the European fund. While Lochen will retain control of the European High Yield fund, this move and the new responsibilities of the position will undoubtedly occupy more of his time, which is not the best for investors in the fund.
Cazenove to launch UK Equity fund
Cazenove Capital is planning the launch of a UK equity fund, Cazenove Absolute UK Dynamic fund, subject to necessary regulatory approval. The fund will be jointly managed by Neil Pegrum and Paul Marriage, and will focus on small and mid cap companies in the UK market. The fund will retain the ability to invest all across the UK market, however, and will be unconstrained. The portfolio will hold between thirty and fifty stocks, and the managers will be allowed to take both long and short positions. Cazenove expects the fund’s positions to be similar to those in Pegrum’s hedge fund as well as in the Cazenove UK Dynamic fund.
Bennett to replace Roger Guy on two funds
Gartmore has hired John Bennett, formerly of GAM, as a senior portfolio manager on its European Equity team. At Gartmore, Bennett will take over management of Roger Guy and Guillame Rambourg’s Gartmore European Selected Opportunities Fund and Gartmore SICAV Continental European Fund. He has a tough act follow as the Gartmore duo has built an exceptional record on these funds which rank in the top-quartile of their Morningstar category over three, five, ten and fifteen years. Guy and Rambourg will focus on their absolute return, institutional and other strategies. We’re never happy to see retail investors lose access to a talented manager, but Bennett brings strong credentials to the table. He has 20 years of investment experience including 16 at GAM, and has amassed impressive records on board GAM Star European Equity and GAM Star Continental European Equity. Since launch in 1998, Bennett delivered 4.9% per year annualised at GAM Star European Equity, outpacing his average Morningstar Europe Large-Cap Value category rival by 2.6 percentage points on average each year. His performance on the Continental European Equity fund (which is more relevant to his forthcoming Europe ex UK mandates at Gartmore) has been equally solid, although more volatile. Over its lifespan, Bennett returned 10.7% per year annualised versus 7.1% for his Morningstar Europe ex UK Large Cap Equity category and 9.1% for Guy’s Continental European offering. This was largely driven by the fund’s relative strength in the last two years.
Morningstar qualitative ratings and reports issued this week
Morningstar issued new qualitative ratings and reports on a number of funds available to UK investors this week, including Baillie Gifford British Smaller Companies and Baillie Gifford Investment Grade Bond fund. Click here to see the full list.
