Issue 44 / October 2018
FE Trustnet
magazine
BLOWN OUT
OF THE WATER
DEBUNKING THE BIGGEST MYTHS ABOUT PASSIVES
WEIRD AND WONDERFUL
Obscure markets you
can access with ETFs
ADMITTING DEFEAT
When active fans
go passive
GET WITH THE PROGRAM
Are trackers at risk from
algorithms?
Fund, Pension, Trust / Sector Profile / Stockpicker / What I Bought Last
ISSUE 44
CREDITS
FE TRUSTNET MAGAZINE
(FORMERLY INVESTAZINE)
IS PUBLISHED BY THE TEAM
BEHIND FE TRUSTNET IN
SOHO, LONDON
WEBSITE: www.trustnet.com
EMAIL: editorial@financialex-
press.net
Editor’s letter
T
he asset
management
industry
doesn’t do itself many
favours when it comes
to transparency. One
interview I attended
consisted almost
entirely of a bond
manager attributing
his stellar returns
to the small size of
his fund – yet when
I asked if he was
going to close it once
it reached a certain
level of assets, the PR
assistant demanded
a quote-check
before banning me
from using 90 per
cent of the 2,000-
word transcription
I submitted. And,
at a recent press
conference which
aimed to highlight
how a third of funds in
Contents
Anthony Luzio
Editor
T: 0207 534 7652
Photos supplied by iStock
Cover illustration: Javier Otero
not doing itself many
favours over the years,
the asset management
industry might just
have been doing itself
one too many favours.
Enjoy reading,
Get with the program Float like a butterfly/
stung like a bee What I bought last
P. 23-27
Javier Otero
Art direction & design
W: www.feedingcrows.co.uk
Sales
Richard Fletcher
Head of publishing sales
T: 0207 534 7662
Richard Casemore
Account manager
T: 0207 534 7669
utterances of active
managers with a pinch
of salt, focusing less on
claims of beating the
market and more on
the one variable they
know they can control
– cost. This is why
we are devoting this
issue to the merits of
index tracking, with a
cover feature by Robin
Powell – a man who
thinks that, rather than
Anthony Luzio finds out
whether algorithms pose a
threat to computer-based
tracker funds
CONTACTS:
Editorial
Gary Jackson
Editor (FE Trustnet)
T: 0207 534 7680
Rob Langston
News editor
T: 0207 534 7696
Jonathan Jones
Senior reporter
T: 0207 534 7640
Mai Sardon
Reporter
T: 0207 534 7625
one area of the market
had cut their fees since
RDR, the mood quickly
soured when one
journalist asked: “So…
why wasn’t anyone
cutting their fees before
RDR?”
A lack of trust in
the industry may be
responsible for the
recent growth of passive
investing. Investors
have begun to take the
Fund, pension, trust
34
Blown out of the water
Weird and wonderful
Robin Powell of The Evidence-
Based Investor debunks some
of the biggest myths about
passive investing Holly Black looks at some of
the most obscure areas of the
market you can access via
ETFs
UK market ripe for stock
pickers Sharing the spoils of
global income markets
P. 2-7
Baillie Gifford’s Milena Mileva
says the UK contains some
“tremendously exciting
businesses” that are world
leaders in their field
P. 8-11
P. 13-16
Janus Henderson’s Ben
Lofthouse shares his view of
overseas income markets and
the momentum behind global
dividend growth
P. 18-21
Baillie Gifford European,
Neptune Balanced and
Brunner Investment Trust
find themselves under the
spotlight this month
P. 28-33
Admitting defeat
Even the biggest
proponents of active
investing are willing to
throw in the towel when
it comes to the US, writes
Adam Lewis
Often regarded as a way
to make a quick buck,
buying into IPOs can see
you nursing significant
losses if you don’t do your
research, writes AltRetire’s
John Blowers
Anthony Luzio
Editor
Fairstone Group’s Oliver Stone
says GAM Star Japan Equity is
one of the few funds that
can back up its claim of
being genuinely long-
term in its outlook
P. 50-51
P. 42-47
Under 50s
Octopus’s Richard
Power names
three “hidden
gems” that are under
£50m in size
P. 48-49
P. 34-39
Data hub
Crunching the biggest
trends down into figures
P. 40-41
13