InvestmentsSep 17 2014

Japan and Asia exposure helps Premier Worldwide

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A high exposure to Japan, emerging markets and Asia has played out well for the Premier Worldwide Growth fund, data has shown.

With a fund size of £45.3m, the portfolio has provided an excellent return of 50.34 per cent in the past three years, placing it ninth in the Investment Management Association’s Flexible Investment sector, according to data from Morningstar.

Led by David Hambidge, with a team of three others, the main strategy of the fund is to grow value over the long term by investing in a diverse range of collective investment schemes to reduce stock-specific risk.

A small portion of the portfolio may be held in alternative assets, which Mr Hambidge said can produce equity-like returns but with a low correlation to global stock markets.

Data has shown that the portfolio fared well in the second quarter of 2014, outpacing its peer average. The decision to reduce exposure to UK small and mid caps and the addition of UK commercial property funds helped the portfolio’s performance, too.

The minimum investment is £1,000 and the ongoing charge is 2.73 per cent. According to data, 16.4 per cent of the portfolio is held in Japan equities, 16.1 per cent in Global emerging market equities, 14.5 per cent in Asia Pacific equities and 12 per cent in both European and UK equities.

The portfolios top three holdings are the £807.4m Hermes Asia Equity fund, at 5.2 per cent; the £36.3m Lindsell Train Japanese Equity fund, at 4.7 per cent; and the £184.2m Baillie Gifford European fund, at 4.7 per cent.

In the same peer group, the CF Miton Worldwide Opportunities Fund also has high exposure to equity funds, particularly investment trusts.

Fund manager Nick Greenwood said the objective of the £19.4m portfolio is to seek growth by investing primarily in a full range of both open- and closed-ended funds.

While the fund primarily invests in investment trusts listed on the London Stock Exchange, Mr Greenwood said there is also leverage to invest in shares or securities of other similar types of closed-ended investment vehicles.

The portfolio’s top three holdings are the £301m Macau Property Opportunity fund, at 4.3 per cent; the £141m Henderson Value Trust, at 4.3 per cent; and the £158m Taliesin Property fund, at 4.1 per cent.

With a minimum investment of £1,000 and a low ongoing charge of 1.95 per cent, the portfolio returned a decent 23.68 per cent in the past three years. However, this still placed it 99th in the sector.

ADVISER SAYS…

Ben Willis, head of research at Bristol-based Whitechurch Securities, said: “The Premier fund is a good choice if you are looking for a diversified global equities fund-of-funds. As the fund sits within a flexible sector that consists of a broad range of funds, you are reliant on the expertise of the management team’s ability to generate returns. In this respect, the Premier team have delivered, particularly in recent years, compared to the sector average.

“Nick Greenwood, manager of the CF Miton fund, has delivered mixed performance. In the long term, he has managed to beat the sector, but the fund has a ‘long tail’ – many of the holdings represent less than 1 per cent of the portfolio and are not making a meaningful contribution. There are better opportunities elsewhere in the sector.”