Close Fund Management has launched a fund investing in zero dividend preference and capital shares. ...
Close Fund Management has launched a fund investing in zero dividend preference and capital shares.
The Close Reserve Equity fund is an Oeic and is aimed at deriving stability from a selection of zeros and the potential for growth in a selection of capital shares.
The fund, managed by Godwin Tsui, will invest in zeros that have an average gross redemption yield of 6.7%, and a hurdle rate of -18%. This means the fund will have access to around 100 zeros, with a £3bn market cap.
The fund is available as an Isa or Pep transfer, and carries an initial charge of 5%. Minimum investment is £1,000 and there is a regular savings scheme that starts at £100 per month. The annual management fee is 1.5%, and there is 1.5% commissionavailable along with a 0.5% trail.
Roland Kitson, marketing director at Close Fund Management, said many savers are attracted to the style of returns offered by zeros but have recently found it hard to construct a portfolio that captures these returns.
He said: 'There is a clear need for a manager, such as Close Fund Management, with the expertise in trawling over the market of over 100 zeros, to select those most likely to meet the key criteria of returns with stability.
'We think investors want to take advantage of the capital market, so the fund also invests in capital shares when the right opportunities arise.'
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