Jupiter Financial Opportunities

Masomnia

StevieJ wrote: »

Maybe, Guy De Blonay is being lined up for the old fund

Ooh has that been confirmed? If Philip Gibbs is going to manage the new financials one I think I'll probably follow him. I've had the fund about 4/5 months now, and have been impressed with how he's managed it so far. If it's going to be like FO but with a few more options at his disposal it could be quite good.

I wouldn't want the Absolute Return fund as I don't think they're all they're cracked up to be, and having 30 - 40 years of investment ahead of me I don't really think it's worth putting anything in one for the time being.

StevieJ

Masomnia wrote: »

Ooh has that been confirmed? If Philip Gibbs is going to manage the new financials one

Received the letter this morning De Blonay to join Jupiter early next year and joint manage the old fund from next summer.

StevieJ

lemon26 wrote: »

I had considered putting a small percentage into the Absolute Return fund but I don't understand what an absolute return fund is so am wary for that reason.

I think i would go for that fund as well if they paid me a non performance fee if they don't perform Having said that I feel mighty exposed with fully invested funds when the market takes a turn for the worse, I would be much more comfortable if the managers could hold large cash balances or indulge in a some hedgie shorts.

LongTermLurker

In a letter received today, Hargreaves Lansdown are saying that de Blonay and Gibbs will co-manage Financial Opps. Gibbs will then also manage the other two.

Considering Financial Opps has a global remit, and indeed a couple of years ago was heavily focused on Europe at the expense of the UK, I don't see what the new International fund offers that is "new".

HL are "particularly positive" about the AR fund, saying he has a fairly open remit (not just in the financials sector). They also say "The two new funds are interesting, but they are sufficiently different from ... Financial Opportunities and so we are not suggesting that investers switch."

Originally Posted by lemon26
I had considered putting a small percentage into the Absolute Return fund but I don't understand what an absolute return fund is so am wary for that reason.

Basically it just means he can invest on the assumption that shares in a particular company will fall, rather than the usual bet on them rising - I guess sometimes it's easier to spot a loser than a winner

Masomnia

What are people's views/experiences on performance fees? Is 15% of anything above the benchmark fairly standard? Sounds high, but I don't really know.

LongTermLurker

Never bought into a performance fee. On one hand, I agree 15% over benchmark sounds high, and it all depends how closely the fund tracks the benchmark - eg presumably it would be easy to measure yourself against a disparate benchmark and beat it.

On the other hand, I see that subsequent performance fees are not only dependant on exceeding the benchmark, but also exceeding the fund manager's previous best, so if in year 1 the fund exceeded the benchmark by 5%, a 3% betterment the following year would not incur a fee, if I understand correctly.

It could be argued that the manager has an incentive to do well and improve his performance year on year, but a low sector average could lead to the fund incurring a fee when the manager's "just done better than average". I see it as a 15% take of anything better than a tracker would produce, or a reduced return of 85% of the proceeds.

Masomnia

I opted to transfer to the new International Financials fund; decided that with the performance fee Gibbs will probs focus on it more, and maybe leave FO permanently soon to focus on it; it should be more risky, more volatile, and I reckon will therefore perform better over the long term, as bad banks can be profitted from as well as good ones.

lemon26

I've split my holding in the Financial Oppotunities fund 50:50 between remaining in the existing Financials fund and the International Financials - hopefully the ability for the new fund to not be long only should lead to greater chance of reward - especially if he's going to get extra for doing well! Only time will tell though!

Rollinghome

Masomnia wrote: »

What are people's views/experiences on performance fees? Is 15% of anything above the benchmark fairly standard? Sounds high, but I don't really know.

What is the benchmark?

I notice that the hurdle for the Blackrock Absolute Alpha fund is the 3 mth LIBOR, which is currently just 0.61%. That hardly seems so excessively challenging to a fund manager that it deserves an additional 20% performance bonus on top of the 1.50% AMC when you could have got a 4% fix by bunging your money in NS&I.

Edit: It seems the Jupiter’s Absolute Return Fund will also be benchmarked against three-month Libor.

Personally, I think it's a nonsense to pay a bonus for returning just a fraction of what could be had from NS&I savings. If a manager can't do better than equal 100% safe savings they should be sacked not rewarded.


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markd_2

Exactly - i'm not surprised they are so keen for people to transfer - 15% performance fee above 3 month LIBOR - just an easy way for Jupiter to jump on Gibbs' success and create extra revenue. They could have at least used a challenging benchmark for the performance fee to be activated - at this rate you'll be paying 15% on all gains! :mad:

Just a shame that they haven't taken a similar approach to William Littlewoods UCITS III fund - Artemis Strategic Assets which has no performance fee.

I think i'll stick to the Jupiter Financials Fund and the Artemis Strategic Assets fund for a UCITS offering!