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BMO adds ESG funds to LifeStrategy rival range

BMO adds ESG funds to LifeStrategy rival range

BMO has added three new ESG-focused funds to its Universal range of multi-asset strategies. 

The company has positioned the Universal fund range as an actively managed rival to Vanguard LifeStrategy, the passive fund range. The existing Universal funds have ongoing charges of 0.29 per cent; the ESG strategies have fees of 0.39 per cent. 

The three new ESG funds will be managed in the same way as the existing range, allocating capital to other managers at the fund house. Paul Niven will oversee this process, while Simon Holmes will act as fund manager.

The funds will have the same Cautious, Balanced and Growth focuses as the existing funds, adding in a sustainable remit.

In the Cautious fund, the maximum equity exposure is 60 per cent, and the target return is inflation plus 2 per cent. In the Balanced fund the inflation target is 3 per cent, while the maximum equity exposure is also 60 per cent.

In the Growth fund, the target is inflation plus 4 per cent, and the maximum equity exposure is 85 per cent.  

Rob Thorpe, head of distribution at BMO, said: “ We’ve seen significant demand for the funds since launch two years ago.

“Extending the range to include sustainable solutions was a natural next step. BMO has extensive, institutional-scale expertise in responsible investing. We’re applying this to provide retail investors with a low-cost approach to sustainable investing.”

david.thorpe@ft.com

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