For investors looking for excitement this fund is unlikely to appeal but for investors looking for steady sustainable growth potential this fund may well suit.
For new investors choosing the right sector or country can be daunting. Often they are drawn to the best performers, and those being advertised. This strategy can work but the reverse is also true with investors being disappointed because they haven’t fully understood the strategy.
We recently reviewed the Rathbone Global Opportunities Fund, highlighting that the fund might appeal to more cautious investors looking for a globally diversified fund. Our concern was around the heavy bias to the US and other developed economies and no exposure to emerging markets and Japan.
An alternative option is the Threadneedle Global Equity Income Fund which has a similar performance track record but provides a more diversified global spread. Holding around 34% in the US, 22% in Europe and 15% in the UK as well as 10% in Asia, 11% in Emerging Markets and 6% in Japan.
It also differs in that it targets large cap businesses who are strong dividend payers but also have the ability for growth. In a similar way there is no conviction, average top ten holding is between 1% and 2% each and it is a large fund with nearly 90 holdings.
Comparing to the likes of Scottish Mortgage is unfair as this is a less punchy global fund and therefore it is more comparable to Rathbones but even with this there are differences. It will again appeal to the more ‘cautious’ investor but one who is looking for a more globally diversified fund. One concern would be that there are years where it only just beats the passively managed option and possibly it begs the question as to whether investors looking for this type of option might be better to go down that route.