Exeter Zero Preference unit trust has grown in size by £10m over the summer months despite the incre...
Exeter Zero Preference unit trust has grown in size by £10m over the summer months despite the increase in the number of similar funds in the market
Recently Investec Guinness Flight and Neville James have launched funds investing in zero-dividend preference shares and BFS launched a split capital trust with underlying portfolio consisting solely of the share class. The £120m Exeter fund was launched in 1991 and has seen its assets grow by around £40m in the year to date
David Crouchen, managing director of Exeter Unit Trusts, said: "The increase in the number of funds investing in zeros rather than hindering the growth of our fund has actually helped it. The increased coverage of zeros in the press has led IFAs to take more of an interest in them
"The fund is also attracting a lot of business via Pep transfers. Investors nervous about world equity markets are finding funds investing in zeros are good places to shelter. Peps cannot hold cash and zeros offer better yields than bonds
One advantage for investors with more funds becoming available is that they will be able to compare the performance of individual funds. Until the new funds establish a track record the Exeter fund is the only unit trust investing in zeros listed in the Micropal UK General Bonds peer group with performance figures over three months as well as one and three years
Over three years the fund was ranked 48 out of 59 and rose by 21.3% compared with an average rise of 28.3%. Over one year it was ranked 10 out of 75 and rose by 4.1% compared with an average rise of 0.7%. Over three months it was ranked six out of 88 and rose by 1.6% compared with an average fall of 0.2
More than £167,000 raised
Beware ‘temporary’ vulnerability
Partner Insight: A renewed focus on 'knowledge-intensive' companies should help investors realise that these entrepreneurial companies are found in sectors other than biotech or technology.
Celtic WM and Active Wealth