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HIM Capital plays the financials downturn

HIM Capital – Income Fund

Type: Offshore Oeic

Aim: Income and growth by investing globally in bonds and equities issued by financial companies

Minimum investment: Lump sum £1,000

Investment split: 35% bonds, 65% equities

Place of registration: Dublin

Charges: Initial up to 3.5%, annual 1.25%, performance fee 10%

Commission: Initial up to 3.5%, renewal negotiable

Tel: 020 7929 5005

HIM Capital, formerly Hiscox Investment Management, has added the income fund to its range of financials funds. HIM income will target a 6 per cent yield by investing in equities and bonds issued by financial institutions. Income and accumulation shares are available in the fund, which is managed by former New Star financial opportunities manager Nick Brind.

Discussing the merits of launching a financials fund, Albany Financial Consultants financial consultant Kelvin Lilywhite says: “We have seen a relatively good recovery from the absolute lows for many banking stocks but I think almost everyone agrees there is still a lot further up for these banks to go. This may take a number of years but I would be surprised if share prices for financials remain where they are today.”

This observation leads Lilywhite to the conclusion that the fund is suitable to the market as it is taking advantage of current conditions.

“HIM Capital’s existing portfolios show significant outperformance and already have substantial exposure to financials that, coupled with the new managers background in this area, should give investors a little comfort if considering to go into a new fund,” he says.

Turning to the less attractive features of the fund Lilywhite says: “It is quite a niche fund and naturally that brings more risk than investing in a wider ranging income fund.”

Lilywhite thinks that the main competition for the fund will depend on why people are investing in it. He says: “If investors are attracted by the income, the main competition would come from established income funds such as Invesco Perpetual’s high income fund. If people are going purely for the financial play, then funds such as Jupiter financial opportunities will provide competition.”

Summing up Lilywhite says: “I think the fund gives investors a different style of playing the current downturn in financials and choice is always a good thing.”


Suitability to market: Good                                                    

Investment strategy: Good

Charges: Average                                                                   

Adviser remuneration: Good                                                  

Overall 8/10



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