Old Mutual Fund Managers has designed the Old Mutual select large cap fund to fill a gap in its product range,
The company already has a UK small cap and a UK mid cap fund, so a large cap fund was the next logical step. This unit trust will invest in around 40 larger companies listed on the FTSE 100 index. It aims to outperform the index by at least 1 per cent and will be managed by Richard Moore.
Moore joined Old Mutual in October 2001 from Singer & Friedlander and prior to that, he spent nine years with National Mutual. He currently manages the Old Mutual UK growth, OM Gerrard UK growth and OM Gerard UK opportunities funds and also co-manages the UK select mid cap fund alongside Ashton Bradbury.
Moore will combine top-down and bottom-up stockpicking techniques and will not be bound by specific sector weightings. Companies of all sizes will be covered, spanning a market capitalisation of between £1.4bn and £140bn. Sectors that Moore and his team favour include beverages & leisure, UK banks, media and industrial cyclicals, but they are not keen on property and utilities.
The fund is likely to suit investors who are unhappy with the returns from tracker funds in the recent climate of falling stockmarkets and who are now looking for an actively managed fund that offers the potential for higher returns.
However, with economic conditions improving, small and mid cap stocks are better placed to capture growth. But they are higher up the risk ladder than larger companies such as BP, Vodafone and GlaxoSmithKline.
According to Standard & Poor's, the Old Mutual select UK smaller companies fund is ranked four out of 73 funds based on £1,000 invested on a bid-to-bid basis with net income reinvested over three years to April 5, 2002.