Fund spotlight: Legg Mason IF ClearBridge Global Infrastructure Income
Our head of funds research offers a view on one of our Super 60 fund picks.
8th February 2021 11:27
by Dzmitry Lipski from interactive investor
Our head of funds research offers a view on one of our Super 60 fund picks.
The Super 60 fund
Listen or read about our Super 60 fund, it’s your choice.
The Legg Mason IF ClearBridge Global Infrastructure Income fundwas recently added to our Super 60 list as an Alternative Core recommendation. It has two primary objectives – to generate reliable income and capital growth above the level of inflation over five years. The managers seek to outperform the OECD G7 Inflation index by 5.5% over five years.
The fund invests in a diverse basket of global listed infrastructure assets in various sub-sectors such as water utilities, gas, and electricity. The portfolio is also spread across different geographical areas, with the US, Australia and Canada the top three country weightings.
Historically, listed infrastructure has offered investors characteristics of higher dividend yield and lower volatility compared to global equities, as well as exposure to inflation-linked revenue streams.
- Fund winners and losers in January 2021
- Top 10 most-popular investment funds: January 2021
- ii Super 60 investments: quality options for your portfolio, rigorously selected by our impartial experts
Who are the fund managers that run the fund?
The fund is run by the highly regarded and well-resourced infrastructure team at ClearBridge Investments. It is co-managed by Nick Langley, Shane Hurst, Charles Hameih and Daniel Chu, who are based in Australia but regularly travel to their additional offices in the UK, Europe and North America. They also have the support of a team of analysts responsible for idea generation and the ongoing monitoring of existing holdings.
How do the managers invest?
The investment process takes into account both ‘top-down’ macroeconomic factors and ‘bottom-up’ fundamental stock-specific research. The team’s philosophy is that markets tend to misprice infrastructure assets over the short term and there is a great opportunity set in taking a long-term valuation-focused approach.
The managers run a concentrated portfolio of around 40 holdings. They include the Spanish electricity grid corporation Red Electrica (XMAD:REE)Â and Brookfield Renewable Partners (NYSE:BEP), which operates one of the world's largest renewable power platforms.
What makes it special?
The team behindthe fundis very experienced and in addition to generating an attractive yield, currently over 6%, have consistently outperformed the market and other funds in the sector over both the short and longer term, with lower risk. The fund has been extremely resilient during the Covid-19 pandemic. Fiscal stimulus with higher spending on infrastructure in the wake of the pandemic should provide a favourable environment for the strategy going forwards.
Performance
| Fund/Index/Sector | 01/02/2020 - 31/01/2021 | 01/02/2019 - 31/01/2020 | 01/02/2018 - 31/01/2019 | 01/02/2017 - 31/01/2018 | 01/02/2016 - 31/01/2017 |
|---|---|---|---|---|---|
| Legg Mason IF CB Global Infrastructure Income Fund | 2.98 | 22.06 | 11.39 | 2.51 | — |
| S&P Global Infrastructure Index | -12.86 | 18.42 | 5.17 | 6.08 | 29.49 |
| Morningstar Equity Infrastructure Sector | -2.69 | 14.09 | 2.43 | 7.46 | 27.00 |
Source: Morningstar as at 31 January 2021. Total return in GBP.
What sort of investors will it particularly suit?
The Legg Mason IF ClearBridge Global Infrastructure Income fund is a compelling offering run by ClearBridge Investments team of experts. It should appeal to someone who is looking for active core exposure to infrastructure assets within a balanced portfolio designed to deliver relatively high and sustainable level of income.
These articles are provided for information purposes only. Â Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. Â The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.