Fund launches hot up as Christmas approaches

17 November 2009

Fund launches are hotting up again as we roll towards Christmas, with Invesco Perpetual announcing this week that it will launch a new split-capital investment trust later this month.

The Invesco Perpetual Dual Return Trust will invest predominantly in UK equities and be managed by Martin Walker, who currently manages assets of approximately £1.5 billion including the Invesco Perpetual Children’s fund and the Invesco Perpetual UK Growth fund.

After the launch, there is a possibility of a second tranche of shares in February/March 2010.

The trust will have a seven-year life, with a capital structure comprising an equal number of income shares and capital shares, with no bank debt.

"The Invesco Perpetual Dual Return Trust plc is reminiscent of the original days of split-capital investment trusts – the 1960s – and is designed to provide a simple, straightforward separation of returns between income and capital for shareholders with differing requirements and tax arrangements," explains Graeme Proudfoot, head of specialist funds at Invesco Perpetual.

"While self-invested personal pensions and ISAs are designed to protect against both income tax and capital gains tax (CGT), it may make sense to consider the inclusion of income shares only in one or both of these wrappers as all returns from these shares over the trust's seven-year life will be in the form of income," he adds.

The capital shares can then be held outside of the wrappers so that any capital gains accruing could be mitigated by an investor's annual CGT allowance (£10,100 for 2009/2010).

Meanwhile, ETF Securities has unveiled four new exchange traded commodities (ETCs), which completes its commodity platform. The arrival of ETFS Cocoa, ETFS Tin, ETFS Lead and ETFS Platinum (which all offer long exposure) brings the ETF provider’s commodity platform to 148, making it the world’s most comprehensive.

"ETFS Tin is Europe’s first long tin futures ETC, tracking the DJ-UBS Tin Total Return Index," says Nicholas Brooks, head of research and investment strategy at ETF Securities. "Tin has been a strong performer, with the index up 48% over the past 12 months and 271% over the past 10 years on the back of rapidly growing China demand for tin."

ETF Securities has also launched Europe’s first currency ETFs.

A spokeswoman for rival iShares says that it hasn't ruled out following suit into the currency ETF space, but has no firm plans at the moment. However, she reveals that the firm will launch further ETFs on the London Stock Exchange in the new year.

Back within the active fund space, Dalton Strategic Partnership has today launched a new fund: the Melchior Selected Trust: Global Conservative Fund. It is the third within the Melchior Selected Trust range.

Managed by Andrew Dalton and Rupert Caldecott, it will combine capital growth and capital preservation by investing in listed equities, government bonds, cash and hedge funds.

It is a cautious fund though as it has the flexibility to hold up to 100% of its assets in cash.

Finally, HIM Capital, a financials specialist, has launched the HIM Income fund, a financials income fund that is targeting a 6% yield.

It is currently invested 48% in global equities and 32% in fixed-income securities.

Nick Brind, the fund manager, says: "The financials sector offers excellent investment opportunities. We are seeing attractive valuations in the debt market as banks look to rebuild their balance sheets and scope for capital growth in the equity markets, particularly where the better quality companies have lagged the recent run up in share prices."

The minimum investment is £1,000; the fund can be bought through IFAs, discretionary managers and it is also available on the Hargreaves Lansdown platform.

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