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Asset Allocator

from Asset Allocator

Don't look back in anger

Asset Allocator has had cause recently to look at the curious case of M&G, a company presently seeking a new chief executive and chief investment officer.  

Representatives of the firm have been making the rounds highlighting the shake-up that is afoot in the firm’s equity range.

M&G launched the first-ever retail unit trust in the UK in 1931 but its equity range has been in the wars in recent years, with two of its longest-standing and largest  products, M&G Global Basics and M&G Recovery, having a tough time and the former changing its name to Global Themes and both funds changing manager. 

The company's line, apart from highlighting relatively better recent performance from both of the above mandates, is to state that future and recent fund launches have focused on thematic equity strategies, as they look to turn their product range around.

Our database indicates that neither of the above-mentioned funds are held by any of the allocators on our database, with the last DFM exiting the Recovery fund in 2020.

Global Themes has never been held by any of the DFMs in our database.

The most widely held M&G equity fund among the allocators we cover is the M&G Global Dividend mandate run by Stuart Rhodes.

It appears in the portfolios of three of the allocators on our database - and has been sold by two DFMs since the end of 2021.

This fund is top quartile over one, three and five years, though it found it tougher in 2021, when it was bottom quartile. 

The yield is 2.8 per cent. The largest geographical exposure is to the US, while the largest sector exposure is to basic materials.

Global Themes and Recovery remain sizeable funds at £2.4bn and £1.2bn respectively. As does the £2.3bn Global Dividend fund.

But our database features the ghosts of many M&G equity funds which were once held by DFMs in our database but are no longer - including M&G North American Dividend, M&G Emerging Markets, M&G Positive Impact and M&G Episode Macro (though for balance we should probably give a shout-out to M&G Emerging Markets Bond, which is the most popular emerging market bond fund in our database).

That the most widely-held equity fund in the stable appears in only three portfolios is testament to the size of the task facing Jack Daniels’s replacement as chief investment officer at the storied firm.

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