River and Mercantile have launched an Icav Ucits-compliant version of its Global Recovery Fund to meet growing demand for the strategy from investors outside the UK.
The Ireland-domiciled fund will target professional investors in Ireland, the Channel Islands and the Isle of Man and will be available with unit classes in Euro, Pound Sterling and US Dollar.
The fund will be based on the same strategy as the existing Â£ 418.8million UK-domiciled R&M Global Recovery fund launched by manager Hugh Sergeant in 2013.
River and Mercantile, UK Wholesale Manager Simon Smith said: âLaunching an offshore version of our successful global relaunch strategy is a natural extension of our product line.
âIt gives professional investors based in the Channel Islands, Isle of Man and Ireland the opportunity to access a specialized portfolio of value-and-payback-based companies managed by one of the top managers. Hugh Sergeant’s most experienced and reputable.
Reflationary environment and stimulus plans to benefit the recovery
Sergeant’s R&M Global Recovery Fund invests in companies around the world that are in the recovery phase of their lifecycle with high potential for value creation. The top 10 holdings include U.S. financial firms Wells Fargo, Citigroup and Bank of America, as well as Chinese tech giants Baidu and Alibaba.
The fund returned 44.8% over the past year compared to the IA Global industry average of 27.7%, but lagged its peers on a five-year basis, with a yield of 95.3% against 97.4% for the sector.
The sergeant said the time has come to expand the range of recovery to a wider investor base as the global economy recovers from the Covid pandemic.
“Various factors are at play that are supporting global growth and benefiting the recovery, including the recovery in consumer demand, the entry into a reflationary phase, government green commitments and larger fiscal and monetary stimulus plans.” , did he declare.
River and Mercantile’s desire to tap European markets follows a series of new product launches. Last September he launched his first European equity fund for Schroders, hires James Sym, and earlier this year he announced his intention to deploy an Infrastructure Equity Income fund, led by the former Aviva Investors man. , Ian Berry.
In addition to attracting managers from rival fund companies, it has also beefed up its wholesale distribution team in the UK, hiring Smith from Merian last year, as well as colleagues Nick Pearse and Martin Canavan.
River and Mercantile announced a 15% drop in pre-tax profits to Â£ 6.2million in its half-year results as of December 31, 2020, when it recorded just Â£ 0.1 billion from entries during the six-month period.