Autif is to move all small cap funds investing outside the UK into one of three sectors, North Ameri...
Autif is to move all small cap funds investing outside the UK into one of three sectors, North American, Japanese or European, writes Kira Nickerson.
At the moment small cap funds are in specialist sectors. Funds which remain in these after the small cap portfolios are stripped out will be merged into a single sector to be called Specialist.
The UK small cap sector will be left unchanged. The alterations to the sector categories are the result of a six month review of fund sector classification by the Performance Category Review Committee. This consists of representation from fund management groups, Autif and members of statistics providers.
The North American Smaller Companies sector, which could include funds such as F&C US Smaller Companies and Mercury American Smaller Companies, is for funds which invest at least 80% of their assets in North American equities of companies which form part of the Russell 2000 index or have an equivalent or lower market capitalisation.
European Smaller companies sector is for funds which invest as least 80% of their assets in European companies which form the bottom 10% by market capitalisation in the European market. They may include UK securities but these may not exceed 80% of the portfolio's assets. This could include funds such as Framlington Continental Smaller Companies and Invesco GT Smaller Companies currently listed in the European Specialist sector.
The Japanese smaller companies sector will be for those funds which invest at least 80% of their assets in Japanese equities in companies which form the bottom 10% by market capitalisation.
The forthcoming Specialist sector will be made up of the UK, North American, European, Japanese, Far East and Global specialist sectors.
Specialist is for those funds with either a single country or a single sector investment theme.
The Specialist sector is now likely to contain a mixture of technology, ethical, utilities and commodity funds. They will all be flagged so that IFAs can group the similar funds within that sector.
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