Type: Unit trust
Aim: Growth by investing globally in equities and equity-related securities, including derivatives, of companies in the financial sector
Minimum investment: Lump sum £500, monthly £50
Investment split: 100% globally in equities and equity-related securities in the financial sector
Isa link: Yes
Charges: Initial 5.25%, annual 1.25%, performance fee 15%
Commission: Initial 3%, renewal 0.5%
Tel: 020 7314 7699
This fund aims for growth by investing globally in financial companies, with the ability to use derivatives to short stocks and indices and hold big amounts of cash.
Looking at the ways in which the fund could be useful to IFAs and their clients, Chelsea Financial Services managing director Darius McDermott says: “In a sector fairly bereft of options, this is a welcome addition to Jupiter’s increasingly specialist range. IFAs should expect this fund to be run in much the same way as fund manager Philip Gibbs has run the Jupiter financial opportunities fund – a considered, defensive approach that aggressively uses cash allocation.” He adds that the new fund will differ from the existing fund in that it will typically invest in smaller companies and have the ability to short individual stocks or indices synthetically., using derivatives.
Considering the less attractive aspects of the fund, McDermott says: “IFAs have grudgingly accepted that performance fees now appear mandatory on absolute return funds but it has been a bitter pill to swallow. That more conventional funds are now adopting such a price structure is a fresh new concern. This is a growing worry and by adopting such a fee, Jupiter is not alone.”
McDermott says investors and the IFA community deserve a proper and more transparent justification for such fees. “That said, at least Gibbs has chosen a decent benchmark – FTSE Global Financials index – and in his case, I would be confident that over the long-term he will considerably outperform the benchmark. “
Discussing the main competition that Jupiter could face, McDermott says: “Since the defection of Guy de Blonay from New Star to Jupiter, the upshot has been that Jupiter has effectively removed any real competition.”
Summing up, McDermott says the fund will bolster Jupiter’s range and offer more options in the financials sector to IFAs. “Gibbs has a fantastic track record and we are excited about this new product,” he says.
Suitability to market: Good
Investment strategy: Good
Adviser remuneration: Average