1 June 2021 - Marlborough Fund Managers has taken the decision to move the Marlborough Special Situations fund from the IA UK Smaller Companies sector to the IA UK All Companies sector with effect from 1st August 2021.
As a result of the move, co-managers Eustace Santa Barbara and Guy Feld will have more freedom to ‘run their winners’ as companies grow and move up the market cap spectrum.
Commenting on the move, a spokesperson for the company said: “Running the winners has always been key to the fund’s investment philosophy. Under the current sector guidelines, at least 80% of the fund must be in UK smaller companies but the success of so many of our holdings means the fund is starting to edge up against that limit.
“The managers would obviously rather not sell or trim these growing companies, just because they’re succeeding. Under the policy, at least 60% of the fund would still be in UK smaller companies – and therefore the primary focus – but there would be more freedom to hold on to these winners for longer.”
Juliet Schooling Latter, research director at Chelsea, added: “Whilst the move to the IA UK All Companies sector will also give the managers greater freedom to selectively invest in mid-cap and large-cap companies when they identify exceptional long-term growth potential or believe a company is significantly undervalued given its prospects, UK smaller companies will remain the primary focus of the Marlborough Special Situations fund.
“The process, designed to mitigate risk by holding a diverse portfolio and not exposing the fund to too much stock specific risk, will remain intact. As a result, the fund will retain its Chelsea Selection position in the new sector.
“Investors in the fund do not need to take any action unless they prefer a true smaller companies offering, in which case, Marlborough UK Micro Cap Growth, which is run by the same managers and is on the Chelsea Core Selection, may appeal.