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Focus funds are the new buzzwords

as launches from groups such as Gartmore, ABN, Merrills, Lazards and now R&SA testify.

They are a reaction against the craze in benchmark funds that have come to dominate much of the industry.

It was the trackers&#39 success that caused many funds to hug closely to their benchmarks. But many have failed to add value, giving extra ammunition to the index brigade.

Focus funds will be highly concentrated with 30 to 40 stocks and not benchmark-oriented. If they don&#39t like Vodafone, they won&#39t own it. This truly active approach is what many investors expect. The majority of investors are looking for absolute return while the whole fund industry is hooked on relative performance.

However, focus funds are not plain sailing either. They have been around for years, often under the guise of special situations. One of the bestknown focus funds must be Schroder UK Enterprise.

It is therefore very important these concentrated funds have a clear investment process that can be articulated and explained, is flexible, adaptable and allow the individual manager&#39s flair to shine through.

One such fund I believe will succeed is the RSA Prime equity fund under the stewardship of Michael Felton. The fund manager and group has put research, time and resource into it. But I wish all these funds every success. We need our active champions. I take no pleasure in reporting failure.


SocGen arm setting up income fund

Dublin based Societe Generale subsidiary Inora Life is launching a new dynamic income fund in its Offshore Generation Bond series. The fund with a minimum investment of £6,000 launches on June 11 and closes on July 20 will be distributed solely by IFAs. Inora Life says the fund is linked to stocks carefully selected to […]

JPMorgan Fleming Asset Management set to launch

The merger of Chase Fleming Asset Management and JPMorgan Investment Management will see the launch of JPMorgan Fleming Asset Management on May 14.The new company will have assets under management of over £416m.JPMorgan Fleming Asset Management head, Europe, Asia and Japan, Paul Bateman says: “A key element of the new combined company will be its […]

CIS puts £3m into admin

CIS is investing £3m in a stakeholder admin system from Marlborough Stirling.Marlborough, which specialises in software and services to the mortgage, life, pension and investment market sectors, has been working with CIS for 10 months on implementing the system.Marlborough&#39s systems allow CIS to provide stakeholder pensions via multiple channels. CIS&#39s direct salesforce of 4,500 can […]

Charcol switching site to supermart

Mortgage IFA Charcol is to convert online broking service Charcolonline into a fund supermarket offering a range of products and services from other companies.Charcol, acquired by Bradford & Bingley in February 2000, will reposition its mortgage website later in the year as a supermarket offering products including stakeholder, bonds and Isas.The technology for the electronic […]


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