M&G Global Leaders A

Invests in firms around the world where price does not reflect improving returns.

  • 0.00p Price (Inc)
  • 0.00p Price (Acc)
  • 4.00% 0.00% Initial charge
  • 1.50% Annual management charge
  • 1.67% Ongoing charges
  • 0.00% Yield

Fund data last updated 04 February 2011

This fund aims to maximise long term returns through investment in equities worldwide. The manager uses a cashflow based filter to target mid and large cap companies that are undergoing internal change, for instance appointing new management teams. The fund's name is slightly misleading and is the legacy of a previous mandate.

Fund summary

Sector Global
Structure X-OEIC
Launched May, 1985
Size £393m
Yield 0.00%
Charging basis Capital
Dividends paid 30 Apr, 31 Oct

Charges

Standard initial charge 4.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 1.50%
Ongoing charges figure 1.67%

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Investment process

This fund targets companies undergoing internal change e.g. selling poorly performing businesses or appointing new CEOs, as manager Aled Smith believes owning these can generate substantial outperformance. Typically these will be recovery situations, but the portfolio also includes “quality” companies generating positive returns where internal change could make the business even better. Investments are principally identified by using cashflow based valuation tool Holt to find companies with an improving rate of return that are currently undervalued. Portfolio companies may also be sourced through a regular report on companies that are changing their management teams, from elsewhere in M&G and from broker contacts. Companies identified are then researched in depth - this includes meeting company management and an independent audit of company accounts. Research is almost entirely internal as Smith believes external research is primarily short term - stocks are selected with a 3 to 5 year time horizon in mind. The manager is supported by dedicated global analysts as well as utilising M&G’s pan European research team. The process is almost entirely bottom up, but the portfolio is typically diversified by sector and country with stock selection expected to be the main driver of returns.

Fund manager Aled Smith uses a variety of ways of finding "alpha" and has shown willingness to evolve his investment process and to learn from his mistakes, in particular the underperformance during the banking crisis. Though he has a long track record as co-head of M&G's global equity desk, his funds' outperformance has tailed off recently. In June 2012 we downgraded this fund from 3 to 2 stars since changes to the investment process do not seem to have improved performance.

Manager research

Average monthly relative returns

  • 14/15 -0.38%
  • 15/16 -0.61%
  • 16/17 -0.19%
  • 17/18 0.11%
  • 18/19 0.00%

Bestinvest MRI

  • 3 years 0.00%
  • 5 years 0.00%
  • Career 0.05%
  • 3 years 0.00%
  • 5 years 0.00%
  • Career 90.50%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Aled Smith

Smith joined M&G in December 2000 as a fund manager on the Specialist Global Equity desk before being appointed head of equity research in September 2003. He left the post in December 2004 to concentrate on fund management full time and is now co-head of the global equity team. Prior to M&G he worked at JP Morgan for eight years, four of which were as a specialist senior analyst for the media sector. Before that he was an Actuarial Consultant for Coopers & Lybrand from 1989 to 1992. Smith graduated from Lincoln College, Oxford University, with a BA in Mathematics in 1989. He is a CFA charterholder. He was born on 03/06/1968.

Track record

Aled Smith has 15.7 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.05%. During the worst period of relative performance (from July 2007 - June 2016) there was a decline of 34% relative to the index. The worst absolute loss has been 41%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 91%.

Periods of worst performance

Absolute -41.00% (May 2007 - February 2009)
Relative -34.00% (July 2007 - June 2016)

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

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Top 10 holdings

Data accurate as at 31 March 2018

4.6% Microsoft Corp
4.3% Amazon.com Inc
3.6% Motorola Solutions Inc
2.9% Mgm Resorts Intl
2.8% Aia Group Ltd
2.7% Scout 24
2.5% Nomad Foods Ltd
2.5% Nomura Co
2.4% Ingredion Inc
2.4% Morgan Stanley
Source: Trustnet

Sector breakdown

Information Technology 24.00%
Financials 22.00%
Consumer Discretionary 18.00%
Health Care 12.00%
Industrials 10.00%
Consumer Staples 5.00%
Energy 4.00%
Materials 2.00%
Telecommunications Utilities 2.00%
Money Market 1.00%

Portfolio

Typically 50-80 stocks are held. US exposure will have a high degree of commonality with Smith's M&G American fund.

Constraints

There are no formal constraints on stock, sector or regional weights. Typically stock weights are 1%-3%.

Key Investor Information - Income

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Key Investor Information - Accumulation

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