London-based asset manager M&G Investments has proposed a series of changes regarding the M&G Global Basics fund with the aim of enabling its manager, Jamie Horvat, “to take full advantage of a wide range of themes developing in an ever-evolving global economy.”
The fund had some £2.08bn (€2.34bn) of assets under management as at end of August 2017.
Among the changes already approved by UK financial market regulator FCA but subject to shareholders’ green light, the vehicle is to be renamed as M&G Global Themes fund and the MSCI All Country World Index will become the new benchmark of the strategy.
M&G intends to modify the fund’s investment policy as following : the fund will be allowed to invest at least 80% of its net assets in global equities in an unconstrained way whereas the current policy requires basic industries’ stocks – primary and secondary industries – to form at least 70% of the fund.
Another change proposed is to drop the long-term capital growth capital objective of the fund for a total return approach. The fund will seek to outperform the MSCI All Country World Index over any five-year period.
M&G fund manager Horvat will adopt an approach combining top-down and bottom-up analysis, identifying themes arising from long-term structural shifts and trends such as demographics, technological innovation and the environment.
Commenting on the fund’s amendments: “Over recent years trends within the global economy have evolved so the removal of the restriction to invest mainly in basic industries will enable us to widen the themes in the fund. We are keen to capitalise on sectors and industries that benefit from increased demand for healthcare and medicines to support ageing populations, water and waste management, clean energy and cyber-security.”
As of 30 June 2017, M&G managed over £281.5bn (€317.78bn) in assets.