Standard Life is to deter inflows into its UK Smaller Companies Fund to try to contain its size. At the end of March the fund's assets totalled £1.1bn, making it difficult to hold a meaningful position in a company with a small market capitalisation, as the fund may not easily be able to buy as many shares as it wants.
From 27 June, Standard Life will impose the full initial charge on all inflows and remove any special dealing terms, such as are offered by discount brokers and fund supermarkets. Standard Life will also raise the fund's initial and annual management charges.
Investors will still be able to gain access to the expertise of the fund manager, Harry Nimmo, and a similar portfolio by investing in the Standard Life UK Smaller Companies investment trust, although this trades at a premium to net asset value of around 2 per cent.
It follows the decision of Troy Asset Management to restrict access to its Trojan Fund, although this is still available via the Alliance Trust Savings i.nvest platform.
t1ps launches third EIS fund
Small cap specialist t1ps Investment Management is launching its t1ps Smaller Companies Enterprise Investment Scheme (EIS) Fund 3, which will invest in small companies quoted on the Alternative Investment and PLUS Markets.
The fund will target stocks with good growth potential or which its managers, Tom Winnifrith and Robert Sutherland Smith, consider to be fundamentally undervalued.
The closing dates for investment are 13 May and 3 June, and the minimum investment is £5,000. The fund has an annual fee of 1.5 per cent, an initial charge of up to 5 per cent and it will levy a performance fee of 20 per cent of all distributions once investors have received 120p for each 100p subscribed.
EISs have recently had their tax reliefs extended, so that they offer 30 per cent income tax relief if you hold the shares for more than three years. From 2012 EIS will be able to invest in a wider range of companies.