Global Opportunities Fund

A Better Way to Access Emerging Markets

Fund overview

Thornbridge Global Opportunities Fund is a thematic fund with reduced stock specific risk. The managers believe the agent of change in the global economy is the 6bn population living outside the west and they seek businesses that engage with it, wherever they are. They believe this is a better way to access developing markets.

The investment approach is simple, transparent and unconstrained. The fund has a proven long term track record with 10.35% compound annualised growth since 2004.

The investment objective is to seek capital & income growth from investments identified across global equity and/or bond markets. The managers may also choose to hold government securities, collective investment schemes and cash & money market instruments as appropriate in achieving the overall objective of the fund. Please note that the themes currently being pursued by the managers lead it to invest in a number of higher risk emerging economies. The investment process is focussed on identifying the sectors that sit within chosen themes and constructing a diversified portfolio within those sectors.

ISIN Currency Price/NAV Change Price date
Acc GB00B5TP8W88 GBP 416.05 0.0543%   24 Apr 2018
Inc GB00B5SZCM77 GBP 364.98 0.0543%   24 Apr 2018

Fund manager comment - March

The fund fell by 4.08% in March. An ugly figure in absolute but a quartile 2 position relative to peers. Markets have been rattled by trade war talk. Our take is that the Trump regime is pro fair free trade and that it will probably make some progress to that objective given the scale of imbalances existing between itself and China, if rational economic negotiations take place rather than silly political ones. Both sides are, ironically, probably more in the former camp than the latter.

The Global economy is in good shape. Rates of growth which had looked as if they could rise above comfort zones have moderated, all be it to levels still above trend rates. Wages are at last beginning to rise in the big western economies but not at rates that suggest capacity constraints sufficient to rattle the inflationary cage. Mid-term inflation is trending at around 2% in the US, 1.5% in the Euro area, 1% in Japan and 2% in China. Inflation forecasts are for higher inflation but they have been ahead of actual inflation for some time. Even with Oil not far short of $70 per barrel. The implication is that the global economy contains spare capacity in terms of both Labour and equipment. In other words possible trend rates may be rising as the developing and developed worlds merge.

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Therefore it should probably be no surprise that the weakest links in our invested universe are the capital goods companies. Not Tech, despite the media noise. It has been difficult to identify this reality during the month but the preponderance of sales adjustments has been of engineering type businesses.

The Global Opportunities Fund represents a stake in the consequences of rising incomes outside G7. The managers believe the investment universe has for some years been split into two economies - 'The Supplied' consisting of 1bn western consumers and 'The Suppliers' consisting of 6bn worker exporters. Against this backdrop investors have allocated assets by geography. We now live in a single global market place of 7bn consumers requiring assets to be allocated to those companies catering to the collective needs and wants within it.

The managers believe that markets are broadly efficient and asset allocation therefore delivers greater reward than individual stock selection. The Investment process is focussed on identifying sectors that sit within chosen themes by using screens for market signals and sector patterns.

Conventional bottom up research is then applied to the resulting shortlists with the managers looking for companies exhibiting the highest quality earnings, dividends, margins and sales CAGRs within the group. They favour businesses that enjoy ‘little and often’ recurring demand, are established with strong market positions and can demonstrate a degree of pricing power or economic moat.

The managers believe in the concept of compounding - adding to winners and reducing losers. In this way success is reinforced and destruction minimalized. Those stocks that don’t grow, go.

Inception
January 2004, run by Thornbridge IM from August 2015
Assets*
£65.3 M
Investment Objective
Capital Growth
Investment Policy
Unconstrained theme based fund with emerging market emphasis
Type
OEIC, UCITS long only fund, daily dealing, single share price
Illustrative Benchmark
MSCI World TR GBP
Sector
IA Global
Ongoing Charges
1.05%
Number of Holdings*
228
Dividend Yield*
1.60%
Sedol Number
Acc: B5TP8W8
ISIN
Acc: GB00B5TP8W88
Bloomberg Code
JMFPOLA
Authorised Corporate Director
Maitland Institutional Services Ltd – Dealing Line: 0345 305 4216
Contact Details
James Bedford, Thornbridge Investment Management
Direct: 020 8004 3275, Mobile: 07775 817 127
james.bedford@thornbridge.com
Inception
January 2004, run by Thornbridge IM from August 2015
Assets*
£65.3 M
Investment Objective
Capital Growth
Investment Policy
Unconstrained theme based fund with emerging market emphasis
Type
OEIC, UCITS long only fund, daily dealing, single share price
Illustrative Benchmark
MSCI World TR GBP
Sector
IA Global
Ongoing Charges
1.05%
Number of Holdings*
228
Dividend Yield*
1.60%
Sedol Number
Inc: B5SZCM7
ISIN
Inc: GB00B5SZCM77
Bloomberg Code
JMFPOLA
Authorised Corporate Director
Maitland Institutional Services Ltd – Dealing Line: 0345 305 4216
Contact Details
James Bedford, Thornbridge Investment Management
Direct: 020 8004 3275, Mobile: 07775 817 127
james.bedford@thornbridge.com

* As at 29 Mar 2018

Top 10 Holdings

Partners Group Holdings1.26%
Croda International Plc1.12%
Visa Inc1.10%
Estee Lauder1.09%
Eramet1.05%
Segro0.99%
Keywords Studios0.99%
American Tower Corp0.97%
Rubis0.90%
Fraport0.89%

Sector breakdown

Consumer Facing20.17%
Strategic Assets19.97%
Capital Equipment19.94%
Tech12.61%
Hard & Soft Commodities12.39%
Healthcare11.31%
Financial3.61%

Performance over past 10 years

Cumulative performance to March 2018

3 Mnth 6 Mnth YTD 1 Year 3 Year 5 Year 10 Year
Global Opportunities Fund -5.26% 0.06% -5.26% 7.42% 33.23% 43.87% 76.94%
MSCI AC World TR GBP -4.38% 0.37% -4.38% 2.89% 35.91% 72.60% 157.29%
MSCI EM TR GBP -1.96% 4.53% -1.96% 11.97% 38.08% 40.82% 97.60%

Discrete performance to the last quarter end

Managers

Anthony Eaton

Anthony Eaton Anthony has been lead manager on the Global Opportunities Fund since 2005. As well as running the fund, Anthony continues to be a senior investment manager at JM Finn. Anthony graduated from Bangor University with a BA in Economics and is a member of the CISI (Chartered Institute for Securities & Investment). Prior to joining JM Finn in 2001, Anthony was with Greig Middleton which he joined in 1990.

Isabella Galliers-Pratt

Isabella Galliers-Pratt Isabella has been working with Anthony on the Global Opportunities Fund since November 2010. After graduating from Bristol University, Isabella did an internship with UBS before joining Key Asset Management in 2001 (part of SEB, Swedish Bank) as an analyst. She then worked for Hargreave Hale focusing on the VCTs and assisting with the management of an asset allocation model before joining JM Finn in January 2010. Isabella holds the Investment Management Certificate (IMC) and Investment Advice Diploma (IAD).

How to invest and further information

To deal in the units of Thornbridge Global Opportunities Fund please call Maitland Institutional Services Ltd on +44 (0)345 305 4216.

Further information and forms are available from Maitland Institutional Services Ltd at www.maitlandgroup.com/fund-info/mi-thornbridge-global-opportunities-fund/ or call +44 (0)345 305 4216.

For further enquiries on the Thornbridge Global Opportunities Fund please contact James Bedford at Thornbridge Investment Management on +44 (0)20 8004 3275 / james.bedford@thornbridge.com