Investec Asset Management, the specialist international investment manger, is launching its onshore global energy fund to mirror that of the Guernsey-based GSF global energy fund which is AAA-rated by Forsyth Partners.
The group says it is responding to IFA demand and aims to exploit capital growth opportunities represented by investment in exploration, production or distribution of oil, gas and other energy sources.
For investors, this fund provides an opportunity to get concentrated exposure to the global energy market which is weighted towards emerging trends in the supply and demand characteristics of oil.
There has been a structural shift in these characteristics, with analysts revising oil price ranges from $30-$35 per barrel. Asian demand for oil has doubled during the past 15 years and is forecast to double again in the next 15 years while energy use per capita in markets such as the US, UK and Europe has fallen.
Oil company shares are argued to be under-valued when looking at historical oil prices, where $55 per barrel was not unheard of between 1974 and 1985.
Speculators may well see an opportunity to buy at a time when there is perceived upside around these fundamentals. The fund has specific sector and concentration risks which could make it highly volatile for investors.
Historical performance looks impressive, with Tim Guinness taking over the management of the Guernsey-based fund in 1998. Since then the fund has remained in the top quartile.
Shane Mullins is managing director of Fiscal Engineers