The Marlborough Technology fund is set to be relaunched as the Marlborough Global Innovation fund in September, reflecting an updated investment policy that will allow manager Guy Feld (pictured) to invest in a wider range of equities not "formally classified" as technology companies.
As a result of the changes to the fund's investment remit, it will move to the IA Global sector, from the IA Technology and Telecommunications sector, when the changes take effect on 22 September 2021.
Marlborough said that, previously, 80% of the portfolio had to be invested in the shares of companies formally classified as either technology or telecommunications businesses but that, following the changes, Feld will have "greater freedom" to invest in businesses that have strong growth prospects because of the innovative or highly effective way they use technology or business processes.
Our particular expertise is at the small-cap end of the market, so our primary focus will be finding the next generation of technology, technology-enabled or IP-driven success stories."
The rebranded fund will have at least 50% invested in smaller companies and it is expected that a minimum of half of the portfolio will be allocated to companies listed on US and UK markets.
Feld took over as manager of the fund in September last year following the retirement of Conor McCarthy, who had run it since launch in May 2003.
"Technology companies can sometimes be thought of very narrowly as those producing hardware, software and services based around silicon chips. We are interested in exceptional companies doing that, of course, but we believe the opportunity set for this fund should be far greater," he said.
"There are so many companies not formally classified as ‘technology' companies that generate value through being technology-enabled.
"We are hugely interested in these technology-enabled companies, those with strong and distinctive intellectual property and those that are putting great tech to work in innovative and creative ways to shake up existing markets or open up new ways of doing things."
He added that there are also investment opportunities in non-chip-related companies that are "breaking new ground because of their distinctive and/or innovative intellectual property, business models and know-how".
Feld, who co-manages the Marlborough UK Micro-Cap Growth, Marlborough Nano-Cap Growth and Marlborough Special Situations funds, said: "While we hold some outstanding large-cap stocks, our particular expertise is at the small-cap end of the market, so our primary focus will be finding the next generation of technology, technology-enabled or IP-driven success stories.
"Rather than focusing on the ‘megatechs', we're looking for the companies with the potential to grow into the technology giants of tomorrow. We're also looking for opportunities where market inefficiencies have resulted in attractively priced small-cap and mid-cap situations."
Marlborough CEO Richard Goodall added: "Guy is a first-class stock-picker, with a strong process and a wealth of experience investing in technology and technology-enabled companies. When you combine technology and innovation, that's the future and we believe the Global Innovation fund offers fund buyers a genuinely distinctive opportunity."
First published by our sister title Investment Week