The Investment Management Association is proposing widespread changes to the global growth sector that would allow more industry specialist funds to enter, Money Marketing understands.
The new definition proposes that global funds which focus on a single industry or sector may also elect to be classified within the global sector.
This includes the likes of global commodity funds, global financial and global pharmaceuticals.
Funds with a clear investment style may also be included if they offer global diversification.
Funds within the global growth sector are currently expected to invest at least 80 per cent of their assets in equities, with no more than 80 per cent in the UK, and have the prime objective of achieving growth of capital.
The new definition – which would see the growth tag drop-ped – would require funds to invest at least 80 per cent of their assets in equities and be diversified by geographic region. It calls for the main focus of funds in the sector to be geographic diversification, with funds eligible for the UK, regional or global emerging markets sectors excluded.
Fund providers will signal these additional characteristics at their discretion. If approved, the new definition will come into force on January 1, 2011.
The IMA says it is unable to comment at this stage.