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HSBC merges funds into 1bn portfolio

HSBC Investments has mer- ged its three core UK equ- ity funds to create the 15th-biggest UK all companies portfolio.

The company’s 413m British fund, 157m household names fund and the 518m growth and income funds, which are all run by Bob Morris, are being merged to create a flagship 1.15bn growth and income fund.

HSBC says the British and household names funds are not different enough from each other to warrant running them as separate mandates and it wants to benefit from a simpler structure. The household names fund was originally laun- ched for sale predominantly through HSBC’s branch networks, with no initial charge and an annual charge of 1 per cent.

Existing investors will retain this lower charge through a separate share class.

Investors in the British fund will benefit from the merger with a lower annual charge of 1.25 per cent, reduced from 1.5 per cent.

The new fund will retain the growth and income track record. The portfolio returned 63.8 per cent in the three years to January 9 and is ranked 108th out of 261 funds in the UK all companies sector.

Morris will have support running the fund, with Roger Noddings, former head of private clients at HSBC, bec- oming UK chief investment off- icer. Noddings will report to global chief investment officer Joanna Munro.

Churchill investments head of research Warren Perry says: “The merger should not have a detrimental effect on investors in size terms, as 1.15bn will be easily inv- ested in large-cap stocks. From HSBC’s point of view, this also makes running the fund simpler and cheaper.”


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