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Terry Smith to launch sustainable equity fund

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Terry Smith to launch sustainable equity fund

(Update) Terry Smith's is gearing up for a third fund launch, which represents a major shift in his mindset, Wealth Manager can reveal.   

According to the Financial Conduct Authority, Fundsmith registered the Fundsmith Sustainable Equity fund on 7 September under the Ucits structure as an investment company with variable capital.

With base details only available at this early stage of its life and Fundsmith declining to disclose any further information to Wealth Manager, it is unclear what exactly the fund will invest in.

However, its branding offers a big sign that it will target companies with positive influences on the environment and society.

It is also not clear who will run the fund but given the relatively small size of the firm's investment team, it is likely Citywire AAA-rated Smith (pictured) will play a major role.

The new sustainability fund suggests a big change in Smith's attitude towards the planet.

This shift emerged two years ago when Smith said in a personal blog he intended to stop airing his climate change scepticism, which he had referred to as 'the quasi-religious belief that there is manmade global warming.' The blog has since been taken down.  

'I have come in for some vituperative comment and action from ‘warmists’, Smith told the Guardian at the time.

'The media on climate change is so biased it would be laughable if it weren’t for the fact that the subject and the waste of scarce resources on cons which pose as solutions are quite serious.' 

Earlier this year Wealth Manager revealed Smith had relocated to Mauritius, meaning he will be spending less than six months a year in the UK.

Speaking at a conference before the move, Smith described Mauritius as 'very well placed as a financial centre due to a combination of factors. In terms of time zone it is well placed for dealing in Asian markets'. 

The Sustainable Equity fund will add diversification to one of the consistently best selling investment firms in the UK. 

It will sit alongside the open ended Fundsmith Equity fund, which has amassed £12 billion worth of assets since its launch in November 2010. 

Its popularity has come on the back of outstanding performance, with the find returning 246.9% since its inception versus a 129.2% gain in the MSCI World Index. 

Over three years to August the fund is the second best performer in the peer group, returning 98.6% versus an average of 46.8% in the sector. 

The firm also operates the closed ended £284.5 million Fundsmith Emerging Equities Trust (FEET), which launched just over three years ago.

FEET has failed to hit the dizzy heights of its open ended counterpart, with its net asset value rising by 15.5% over the last three years versus a 34.7% average in the peer group. 

 

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