In a recent address to the Institute of Economic Affairs, the Deputy Governor of the Bank of England outlined the two primary risks currently facing the UK economy - the ongoing crisis in financial markets and the renewed build up of inflationary pressure.
While investors seem to be mindful of equity risk when looking at investments, many overlook the impact of long-term inflation risk on their future wealth.
But investors with accumulated assets in vehicles such as Self Invested Personal Pensions (SIPPs) cannot afford to overlook the risk posed by higher inflation and its potential to reduce their long-term purchasing power.
Inflationary build up is being driven by soaring energy and food prices. Since the start of 2004, oil prices have more than trebled while metals and food prices have more than doubled.
Some investors have been considering real assets such as property and commodities as methods for reducing their exposure to inflation risk. An increasing number of investors have also been turning their attention to infrastructure investing.
Infrastructure assets such as roads, airports, water and gas distribution business and telecommunications networks, provide essential services to the economy.
Such businesses tend to be characterised by stable and consistent demand from a large customer bases, which can lead to sustainable and predictable cash flows over the long term.
Often, these cash flows are supported by agreed pricing mechanisms with the government or other authorising bodies that enables prices to be increased in line with inflation.
For investors, this can potentially result in income that is protected from the effects of inflation.
CF Macquarie Global Infrastructure Securities Fund
The CF Macquarie Global Infrastructure Securities Fund offers investors an opportunity to access a globally diversified portfolio of typically 40 to 50 infrastructure securities.
Structured as a UK OEIC, the Fund offers the benefits of low minimum investment levels and daily liquidity. It aims to provide investors with a total return over the medium-to-long term consisting of income and capital growth.
Investment team
The Fund is managed by Justin Lannen who has 10 years of investment experience, including seven years in the infrastructure and utility sectors. Justin works closely with the Chief Investment Officer of Macquarie's infrastructure securities business, Jon Fitch, who has 20 years of investment experience.
Our investment team comprises four portfolio managers and seven analysts dedicated to researching the global listed infrastructure securities universe and constructing well diversified portfolios.
Infrastructure and Macquarie
Macquarie has been at the forefront of infrastructure finance and investment for more than a decade. We were early to identify the potential of infrastructure as a resilient, long-term asset class and our approach has been instrumental in harnessing private investment to help meet global infrastructure needs.
We have a wide range of experience in the sector, with teams specialising in areas such as infrastructure finance and advisory, direct investment, equities research, and the management of infrastructure securities portfolios. Across all its businesses, Macquarie Group Limited has more than £53 billion of infrastructure assets under management (as at 30 September 2007).
Contact Macquarie
Neil Jones
020 7532 7651
[email protected]
Important information
This fact sheet is only being distributed to and is only directed at professional clients and eligible counterparties, as defined in the FSA rules. It is not intended for retail clients and such persons should not rely on the information in this document.
Issued by Macquarie Capital (Europe) Limited. Registered in England No. 03704031. Authorised and regulated by the Financial Services Authority. Authorised Corporate Director is Capita Financial Managers Limited.
Investments in the CF Macquarie Global Infrastructure Securities Fund (the Fund) are not deposits with or other liabilities of Macquarie Bank Limited (MBL) ABN 46 008 583 542 or any Macquarie Group Company and are subject to investment risk, including possible delays in repayment and loss of income and capital invested.
Neither Macquarie Bank Limited nor any other member company of the Macquarie Group guarantees any particular rate of return or the performance of the Fund nor do they guarantee the repayment of capital from the Fund. The value of investments and the income from them can fall as well as rise and investors may not get back the amount originally invested.
This document does not take into account the investment objectives, financial situation or particular needs of investors. Potential investors in the Fund must read the Simplified and Full Prospectus issued on 4 June 2007 and make their own independent assessment before deciding whether to invest. Copies of the Prospectus can be obtained by calling 0845 608 0948.
