The Majedie Global Growth Investment Trust is the sixth-worst performing fund in its sector, yet it comes with the highest charges, according to data provider Morningstar.
The fund has a total expense ratio (TER) of 1.7 per cent - the highest in the sector (Morningstar Investment Trust Global Growth) and at least twice as expensive as many of its competitor funds, the majority of which have TERs of less than 1 per cent.
It made a staggering loss over a five-year period with a cumulative return of -39.05 per cent, well beneath its benchmarks FTSE All-Share and FTSE World Indices which returned positive returns of 11.25 per cent and 19.95 per cent (respectively) over the same period. Over a one-year period the performance is much improved with a cumulative positive return of 14.06 per cent, but still not reflective of the high fees.
William Barlow, director at Majedie investments, said the high TER is down to its decision to invest in a new company - Javelin Investments.
And he added: “The reason our performance is near the bottom of the group is that only 50 per cent of the assets are invested in global growth. The rest is invested in absolute returns which are not correlated to the stock markets.”
The fund is 64 per cent invested in the UK, 16 per cent in the US and has heavy exposure to financials (18 per cent), oil and gas (17 per cent), industrials (12 per cent) and basic materials (10 per cent). Its share price is currently 153.00p and it is trading at a 20.31 per cent premium.
