Old Mutual UK Select Smaller Companies Fund

moneylover

Yesterday I recv'd an email from Hargreaves Lansdown suggesting investing in the above fund which has just re-opened with a small tranche for lump sum investment after closing last December. Good past performance and HL have 'high hopes for the future'. Any thoughts on this fund anyone?

jamesd

For the last couple of months the SLI UK Smaller Companies fund has been performing a little better but both appear to be excellent and there's room for different ideas in the smaller companies area. If you look at the discrete year performances below the chart you'll notice an interesting difference in 2002-3 performance, though the manager then is not the same as now so it may not be repeated. The fund has been going more defensive recently and that may well be a good idea.

Note that the Old Mutual fund has a higher AMC and TER (1.75% and 1.81%) than the SLI fund (1.50% and 1.52%). That might account for the small performance difference, since the rise happened from 1 Feb.

If you want a UK smaller companies fund this appears to be a reasonable choice.

If you don't already know that you want a UK smaller companies fund, expect more volatility - up and down price movement - than for larger companies and over the long term possibly better performance. Though there has been at least one decade when smaller companies did less well than larger, so it's not a perfect pattern.

Do note that I'm far from being an expert.

jamesd

The Old Mutual UK Select Smaller Companies Fund is now back to not being available via Hargreaves Lansdown. Might still be available direct from the fund manager, at full initial charge, though the SLI fund seems to be an eminently reasonable alternative.

jamesd

Old Mutual UK Select Smaller Companies Fund is now open to new investment again, I think through all resellers. About twenty million Pounds worth of units available according to Hargreaves Lansdown.