Investments  

Fund Review: Investec Global Franchise

This article is part of
Fund Review: Global Equities

On the flip side he admits “there are always problem children in a portfolio”, with four shares underperforming the fund – Samsung, PayPal, Oracle and 21st Century Fox – with Samsung and Oracle also underperforming the market.

“We still think Oracle will do well and have added to that weighting,” says Mr Rossouw. “PayPal we think will do particularly well in the next two to three years, as well. Samsung we’re not so certain about. We’ve kept the weighting, albeit at a smaller level.”

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Looking ahead the manager notes a number of headwinds in the market, and in particular the challenges to global growth expectations. But he adds: “We continue to back stock-specific instances and will try to continue to avoid being blown up by market conditions or difficult circumstances. But it is definitely a time to be quite circumspect and to make sure one has no problem children in the portfolio.”

EXPERT VIEW

Rob Morgan, pensions and investment analyst, Charles Stanley Direct

This is a global equity fund investing in industry-leading companies – resilient stocks that have high customer loyalty, as well as strong brands and patents that can be difficult for competitors to replicate. It is concentrated at 25 to 40 stocks and invests for the longer term. Global franchise businesses are likely to be well suited to a lower growth environment, which, given current fears, explains why there are now quite a few funds following this theme. It’s a competitive space dominated by heavyweights such as FundSmith and Lindsell Train, so it’s difficult for a fund such as this to stand out. However, it now has three years under its belt, which could be a catalyst to building assets.