M&G UK Select A

Mainstream UK Equity fund which hasn't added value in recent years.

  • 2878.66p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • 4777.02p
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 4.00% 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 1.50%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 1.66%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 2.40%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 18 September 2020, fund data last updated 25 July 2003

This fund targets above average capital returns from a portfolio of mainstream UK equities, that is, it mainly invests in large and medium size UK companies. Stock selection is focused upon finding undervalued quality growth companies (with fast earnings growth) with proven business models.

Fund summary

Sector UK All Companies
Structure OEIC
Launched December, 1968
Size £532m
Yield 2.40%
Charging basis
Dividends paid 31 Jan, 31 Jul

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 1.66%

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Investment process

The M&G UK Growth Fund is a mainstream UK equity fund managed to achieve consistent outperformance of the FTSE All-Share Index. The Fund does this by investing principally in UK companies with high growth potential with the sole objective of capital growth. The manager applies a bottom up (analyses companies in their own right) approach and typically takes a long term view with selected companies. The key focus of the investment process is companies with proven business models and as such this focus precludes many of the more speculative companies in the market. In particular, the manager invests in companies with strong barriers to entry, above average growth prospects and capable management. Once ‘quality’ companies are identified, the manager applies a number of valuation metrics to ascertain that stocks entering the portfolio are attractively valued.

This fund has benefited from a number of experienced fund managers during its past but has never really lived up to expectations. Performance has generally been inconsistent relative to its benchmark and more recently it has displayed higher volatility. The UK All Companies sector is very competitive, therefore those investors after a fund with a bias to large companies may wish to consider, JO Hambro CM UK Opportunities or Schroder UK Core (low fees) both highly rated by Bestinvest.

Manager research

Average monthly relative returns

  • 15/16 -0.77%
  • 16/17 0.08%
  • 17/18 0.15%
  • 18/19 -0.25%
  • 19/20 1.32%

Bestinvest MRI

  • 3 years 0.41%
  • 5 years 0.11%
  • Career 0.15%
  • 3 years 99.20%
  • 5 years 80.80%
  • Career 99.90%

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

Mike Felton

After graduating from De Montfort University in Leicester with a degree in Economics, Felton joined Sun Alliance in 1989 as an investment analyst. Initially a sector analyst, he was appointed as a fund manager in 1994. Following the launch of the UK Prime fund, he relinquished his role on two other portfolios, notably Equity Income which he took over in March 1999. In January 2005 he joined M&G, taking up the newly created role of Head of UK Retail Equities.

Track record

Mike Felton has 19.3 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.15%. During the worst period of relative performance (from June 2015 - June 2016) there was a decline of 13% relative to the index. The worst absolute loss has been 39%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is more than 99%.

Periods of worst performance

Absolute -39.00% (August 2000 - January 2003)
Relative -13.00% (June 2015 - 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.

Allocation

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Top 10 holdings

Data accurate as at 31 July 2020

8% Astrazeneca Plc
5% Unilever
4.6% Reckitt Benckiser Group Plc
3.2% Experian Plc
3% London Stock Exchange Group
2.6% Smith & Nephew Plc
2.3% Games Workshop Group
2.2% British American Tobacco
2.1% Intertek Group
2.1% Weir Group Plc (The)
Source: Trustnet

Sector breakdown

Consumer Goods 22.00%
Industrials 20.00%
Financials 19.00%
Health Care 16.00%
Consumer Services 8.00%
Oil & Gas 6.00%
Money Market 5.00%
Technology 4.00%
Basic Materials 1.00%

Portfolio

A diversified portfolio of around 60 stocks.

Key Investor Information - Income

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Key Investor Information - Accumulation

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