New investment trusts from Terry Smith and the ex-Cazenove team of Tim Russell and Chris Rice have attracted strong demand, with the former bringing the largest closed-ended equity fund to market in more than four years.
Citywire AA-rated Smith’s (pictured) Fundsmith Emerging Equities Trust has raised £193 million, having targeted between £100 million and £250 million.
That makes it the largest conventional equity trust launch since Fidelity China Special Situations secured £460 million in April 2010; fund raisings since then have been more focused on debt and infrastructure.
Rice and Russell’s Sanditon Investment Trust, meanwhile, hit its target of £50 million in an oversubscribed fundraising.
‘Sanditon Asset Management is delighted to have received such broad support for our first product,’ commented Russell.
‘This is an exciting time for Sanditon Asset Management and as the prospectus outlined we look forward to launching our Ucits range of products in the coming months following FCA approval. We thank investors for the confidence they have shown in us.’
As Wealth Manager revealed last year, Russell and Rice are planning to adopt the Lindsell Train model by launching an investment trust that provides investors with a stake in their new boutique.
‘This is an interesting addition to the investment trust sector, and is one of the few equity-focused IPOs in recent years,’ commented Charles Cade, head of investment companies research at Numis.
‘We understand that the intention is not to issue further shares and so the fund is likely to remain a niche investment.
‘The popularity of long/short equity funds among UK investors has waned as many managers have failed to protect capital in times of market turmoil. However, Sanditon benefits from an experienced management team and we expect the vehicle to trade strongly in the secondary market post launch, albeit with limited trading liquidity.’