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OMGI shuts global equity income fund

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Old Mutual Global Investors has shut the onshore Global Equity Income Fund, while launching an offshore version with a trio of managers.

The onshore Old Mutual Global Equity Income Fund, sub-advised by O’Shaughnessy Asset Management, has just £38.8m in assets after seeing a “gradual decline in assets over the last few years”, meaning the costs of running the fund are too high, says Old Mutual.

It says: “Given the small size of this fund and the associated operating costs, Old Mutual Global Investors believes that it is no longer in the best interest of clients to continue running this fund and that investors will be best served by having their proceeds returned in order for them to reinvest in other products.”

The fund has consistently underperformed its sector, returning 9.45 per cent over three years compared to the Global Equity Income sector return of 36.41 per cent. Over one year it has lost 14.95 per cent, compared to a 6.25 per cent gain for the sector average.

“We believe our decision to close the onshore Old Mutual Global Equity Income Fund is in the best interest of investors. We would like to thank O’Shaughnessy for their management of the fund,” says newly-appointed managing director of OMGI Warren Tonkinson.

However, OMGI has launched an offshore version of the Old Mutual Global Equity Income Fund, to be managed by Ian Heslop, Amadeo Alentorn and Mike Servent. It first revealed plans to launch the fund last month.

The new fund will target both income and capital growth, aiming for monthly income 30 per cent higher than the benchmark MSCI All Countries World Index.

“We’ve experienced a high level of client demand for an offshore global equity income fund managed by Ian Heslop and his team,” Tonkinson adds.

OMGI said last month it was reviewing the onshore Old Mutual Global Equity Income Fund.

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