Royal & SunAlliance Eurolife
RSAE Framlington Health Fund
Aim: Growth by investing in healthcare, medical services and product
Minimum investment: Lump sum Euro 15,000
Place of registration: Luxemburg
Investment split: 100% in healthcare, medical services and product
Isa link: No
Charges: Initial 0.5%, annual 1.5%
Commission: Initial 5%
Tel: 00353 15009100
Brian Pack – Principal, Brian Pack Financial Services
John Hill – IFA, Positive Solutions
Jeremy Marsh – Investment manager, Lupton Fawcett
Suitability to market: 5.7
Investment strategy: 7.3
Companys reputation: 6.0
Product literature: 4.3
Royal & SunAlliance Eurolife has introduced the RSAE
Framlington health fund, a Sicav investing in healthcare, medical
services and product companies.
When asked how the product fits into the market, Pack says:
"It is entering a crowded market with the big boys of pan
Europe." Hill thinks it is a speculative product, saying that
biotech has been having some spectacular failure recently.
Marsh says: "It fits well as one of the few providers with a
pedigree in this sector."
Looking at the type of client the Sicav may be suitable for, Hill says:
"Younger clients who expect this type of company to lead
Pack thinks that people who are prepared to accept some risk to
obtain good growth will like the product. Marsh says: "Most
clients with a moderate plus risk acceptance could have this in a
portfolio of £100,000 plus."
Moving on to the marketing opportunities offered by the product, Pack
says he can see none to his clients. Marsh says: "For the
clients, it is a good opportunity because of the current low prices for
those wanting such a fund." Hill says: "The
opening will be there at a time when the biotechs are a
Considering the main useful features and strong points of the
product, Marsh says: "It invests in a good and growing
sector, and currently has a low price."
Hill thinks healthcare will always be in the market, and the need for
this comes from the ageing population. Pack says:
"Framlington has built a very strong team who specialise
When asked to identify the disadvantages of the Sicav, Hill says:
"The failures of the sector get big press
coverage." Pack picks out the bid/offer spread which he
thinks is high, and Royal & SunAlliances
declining reputation. He adds that the fund is subject to currency
Marsh says: "None except must be part of a larger portfolio
due to its longer term nature. This is because its success is reliant
on legislative changes."
The panel is not impressed by the flexibility offered by the fund. Marsh
says there is not much flexibility. Pack says: "The bid/offer
spread is high, which cuts out the flexibility in moving funds
around." Hill says the flexibility is okay, but that there is
Considering the investment strategy of the fund, Marsh says:
"It is not that different from other healthcare companies.
Healthcare is a growing market area. It is fine for the long term, but
for the short term it is probably the most volatile fund in its
Hill does not have a problem with the investment strategy. Pack
thinks the strategy is quite good, and the sort of thing that you would
expect from a healthcare fund.
Turning to the reputation of Royal & SunAlliance Eurolife,
Hill says he is not particularly impressed. He says: "It is
not an all singing, all dancing attraction. It does not back up what it
says. The sales pitch is not supported by the