Investments  

Aviva Investors plots large cap US income fund

Aviva Investors is to soft-close its £366m US Equity Income fund and open a new, similar product to meet ongoing demand for the strategy.

The existing fund is run by Henry Sanders and Thomas Forsha and has gained 36.6 per cent since its launch in July 2011, according to FE Analytics. This lagged its Russell 3000 Value index benchmark, which gained 42.8 per cent.

The group said new investors would be levied a 5 per cent initial charge from October 1. It said that any existing regular investments “will cease at the end of the current tax year”.

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Aviva Investors’ sales director Jeremy Leadsom said the soft-closure was implemented “in the interest of our clients” in order to make sure the managers can “maintain the fund’s size and investment strategy”.

Subject to FCA approval Mr Sanders and Mr Forsha will run the new Aviva Investors US Equity Income fund II when it launches in September. The duo work for River Road Asset Management, a US-based subsidiary of Aviva Investors.

The new fund aims to deliver a yield 1.5 per cent higher than the Russell 3000 Value index and will target companies bigger than $1bn. The fund’s annual management charge will be 0.75 per cent.

Mr Leadsom said the new fund would “have a greater large cap bias than its predecessor and will be less constrained”.