The global equity fund Peter Hargreaves seeded with £25m of his own money has reached more than £200m in size on its two-year anniversary.
The Blue Whale Global Equity fund was launched by fund manager Stephen Yiu, with an initial investment of £25m from Hargreaves Lansdown founder Peter Hargreaves.
Mr Hargreaves continues to chair the fund management company, Blue Whale Capital, that runs the fund, as well as being invested in the fund. Mr Yiu worked at Hargreaves Lansdown many years ago, and later worked at Artemis.
Mr Yiu said: “Since surpassing the £100m assets under management mark at the end of February, the fund has more than doubled in size, reaching £210m at the end of August 2019. Pleasingly, we are starting to see more interest from private client wealth managers and private offices, as well as increased traction in the retail platform space.”
The fund has returned 41 per cent since launch in 2017, compared with a return of 16 per cent for the average fund in the sector in the same time period.
That would make Mr Hargreaves initial £25m investment worth about £35m now.
He said he was “considering” putting more money into the fund.
Mr Hargreaves added: “Stephen had very ambitious plans for the fund when he launched it, but I think he has exceeded even those. There is a saying that fund management is 5 per cent inspiration and 95 per cent perspiration, and these guys certainty fill the second one of those in droves.”
The fund currently has 15 per cent of its assets in cash. Mr Hargreaves said: “This is both a war chest awaiting the right opportunity and a defensive stance in the meantime.”
David Scott, an adviser at Andrews Gywnne in Leeds noted that the fund has 68 per cent of its capital in US equities. Mr Scott is generally bearish about equity markets, but in particular about US equities.
He said: “The US market trades at a cyclically adjusted price to earnings ratio of 30 times. The long-term average is 16, so the market could halve and still be around the top of its range. We also don’t tend to invest in global equity funds. We prefer to pick funds that are more specific, that represent our view of the world. Another issue is that if you buy a global equity fund its quite reliant on what happens with sterling.”
david.thorpe@ft.com
