|Asset Group||Asset Sub-Group||Investment Category|
Why we recommend it
Experienced and well-resourced manager: Since 1999, the fund has been run by Audrey Ryan, who has the support of the wider and well-resourced UK Equities team. Ethical screening criteria is the responsibility of a separate ESG team, while Ryan focuses on the process for stock selection and portfolio construction.
ii ACE ethical style: Avoids. This means the fund simply screens out specific sectors considered to be unethical, or stocks whose environmental, social and governance (ESG) scores are below a certain threshold.
Fund EcoMarket category: Negative Ethical. This relates to funds that use clear, sometimes strict and extensive, negative ‘ethical’ screens as their core strategy. They may avoid a significant number of areas on ethical grounds (e.g. armaments, tobacco, gambling) or may focus on avoiding a smaller number of areas.
How the fund is managed: Aegon Ethical Equity (formerly branded under the Kames umbrella) is an actively managed fund, suitable for investors who seek to gain exposure to UK equities via an ethical solution. Since 1999, it has been run by Audrey Ryan, who has the support of the wider and well-resourced UK Equities team. Ethical screening criteria is responsibility of a separate ESG team, while Ryan focuses on the process for stock selection and portfolio construction.
The fund has a relatively concentrated portfolio of around 50 to 70 holdings with no specific constrains on a sectors or themes. The ethical element of the investment philosophy is shaped by 12 filters that a candidate needs to pass before inclusion in the portfolio. That includes activities around animal testing, military or tobacco production, and environmental issues. In addition, the ESG team reviews current and potential holdings on a regular basis in order to make sure there are no controversies and the businesses are aligned with the fund’s ethical objectives. Due to the strict exclusion process, the manager has a limited universe, hence the portfolio invests further down the market-cap in medium-sized and smaller companies compared to its FTSE All-Share benchmark.
Ethical screening: In certain market conditions, the performance of the fund may differ significantly from others in the peer group that do not exclude specific sectors or companies from a comparable investment universe.
Smaller companies: The bias towards smaller companies and the limitations of the investable universe could lead to returns that significantly deviate from those of the broader UK market. Therefore, this fund could be best utilised to complement a well-diversified portfolio.
|Information and data compiled to October 2020.|
The information we provide in the ACE 40 investments list does not constitute a "personal recommendation". You should ensure that any investment decisions you make are suitable for your personal circumstances and that the ethical style of the investment reflects your personal beliefs.
Past performance of the underlying constituents is not a guarantee of future performance. Remember, the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest.
Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab.
If you are unsure about the suitability of a particular investment or think that you need a personal recommendation, you should speak to a suitably qualified financial advisor.
Any changes to the ii ACE 40 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Outlook.
Details of all recommendations issued by ii during the previous 12 month period can be found here.
ii adheres to a strict code of conduct. Members of ii staff may hold shares in companies mentioned in the ii ACE 40 investments list, which could create a conflict of interest. Any member of staff intending to complete some research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.
In addition, staff involved in the production of this ii ACE 40 list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the list. This is to avoid personal interests conflicting with the interests of the recipients of this ii ACE 40 investments list.