The Close FTSE Techmark tracker has outperformed its benchmark by 2.1% in the 12 months to 3 Novembe...
The Close FTSE Techmark tracker has outperformed its benchmark by 2.1% in the 12 months to 3 November, the fund's first anniversary and also the anniversary of the index.
The £130m portfolio, the only unit trust tracking the index, produced offer-to-offer returns of 46.7% compared with the index performance of 44.6%.
Marc Gordon, managing director of Close Fund Management, said the discrepancy is accounted for by the low cost of dealing by the fund.
Gordon said: "The quality of your buying can make a difference because of the large spreads involved in smaller companies. We have been able to transact well which is what our fund managers spend all their time on."
The fund was launched to track the new Techmark 100 Index, which is made up of the top 100 technology funds and related sectors in the stock exchange, but does not include the largest stocks such as Vodafone, BT and Energis.
The four largest stocks in the index, which was designed to attract IPOs to the London market as many companies were listing on Nasdaq and other overseas exchanges, are Logica, CMG, Arm, and Sage.
It has been a volatile year with Techmark touching offer-to-offer growth levels of over 135% since launch to 1 March 2000. That plunged to around 25% at the end of June.
The index's profile and importance have grown massively with the total market capitalisation growing from just over 2% of the FTSE All-Share to 6.1%.
Gordon does not expect to see that level of volatility repeated to the same extent over the next 12 months.
He said: "Despite some of the bearish comments surrounding the sector, the fund's performance remains at over 40% since launch. Approximately half of the fund is invested in larger, blue chip technology companies that provide a solid core holding.
"The index went up from 0% to 140% in the space of a few months. We won't see that again or the phenomenal falls. It is also true that quality and pricing of new IPOs coming to the market has improved significantly. Investors have learnt their lessons, as have the corporate financiers."
The split of assets in the index at the end of October was computer services at 25%, computer software at 19%, biotechnology at 18%, electronic equipment and semi-conductors at 14%, telecommunications with 12%, computer hardware at 3%, internet at 2%, and others at 7%. On the back of the success of the Techmark tracker, Close Fund Management has launched the Close FTSE Europe eTX Fund to track the FTSE eTX Euro 50 Index of European technology stocks.
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