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Blue Whale Growth Fund surpasses £1bn in AUM

Blue Whale Growth Fund surpasses £1bn in AUM

The Blue Whale Growth Fund has surpassed £1bn in assets under management four years after its inception. 

The fund, launched four years ago with £25m, hit the milestone on September 24.

In a statement released this morning (September 27) Peter Hargreaves, co-founder and chairman of Blue Whale Capital, the fund's holding company, said: “The passing of the £1bn milestone in only four years is testament that hard work and superior investment performance are the keys to success in fund management.”

Stephen Yiu, co-founder and chief investment officer of Blue Whale Capital, said when the fund was launched in September 2017 his aim was to deliver consistent significant outperformance to savers and pensioners in the UK.

He added: “I am delighted that, four years on, we have stayed true to our aim for the savers and pensioners who are now entrusting us with £1bn to manage. 

“This is just the beginning of the road for us as we hope to share our passion for delivering consistent significant outperformance with even more investors in the UK and beyond.”

Since its creation, the fund has delivered a 114 per cent return to investors, compared with the IA Global sector average of 59 per cent, as at August 31 this year.

The fund said this equates to compounding at 21 per cent per year for Blue Whale investors compared with 12 per cent per year for IA Global, representing a 9 percentage points annual outperformance for Blue Whale investors.

In March Yiu introduced the concept of 'beautiful companies' as an investment style for the fund. 

Under the concept the fund will avoid investing in companies where "beauty is only skin-deep" and instead opt for those that generate significant outperformance, are well managed, operate in attractive industries and grow sustainably.

At the time, Yiu said: "We avoid companies where beauty is only skin-deep. We see them in ‘narrative stocks’ where the share price is sustained by stories, not fundamentals. 

“A truly beautiful company must not only have a compelling narrative but also the fundamentals to back it up. We look for exceptional businesses that are well managed, operating in attractive industries and that can grow sustainably.” 

In January, the fund’s holding company posted its first profit since its inception

Blue Whale Capital recorded a profit of £362,000 in the year to the end of March 2020 which compared with a loss of £280,000 recorded in 2019.

Blue Whale Capital was founded by Hargreaves and Yiu in 2017, with Mr Yiu running the Blue Whale Growth fund, the company’s only product.

sally.hickey@ft.com