Merrill Lynch Investment Managers is boosting its range of funds with the introduction of the MST world energy fund.
The fund is a dollar denominated Luxemburg based SICAV and has been introduced with the experienced investor in mind. Merrill Lynch has aimed it at investors who are looking to add a high-risk fund to their portfolio.
MST world energy will be managed from London by Robin Batchelor, who joined Merrill Lynch Investment Managers in 1996. He is also the manager of the Merrill Lynch new energy technology investment trust and the energy international fund.
The fund will invest in companies in the energy market, covering a wide range of sectors, such as oil, oil field exploration, natural gas, oil refineries and alternative energy, such as wind turbines and tidal barrages.
The bulk of the fund will be invested in the US, with rest of the investment in Canada, Australia and Europe.
World energy is a high-risk fund as it invests in just one sector of the market and has historically been easily affected by events in the Middle East. However Merrill Lynch believes that the recent recovery of OPEC and its tightened grip on the market will lead to less volatility in the price of oil. Also the increasing number of alternatives to oil, such as wind energy, should lessen the funds dependency on just one part of this sector.
According to Standard & Poors the Merrill Lynch new energy technology investment trust is ranked 2 out of 15 funds, based on £1,000 invested on a mid-to-mid basis with net income reinvested over one year to April 9, 2001.