The Lowes UK Defined Strategy Fund (UKDSF) marked its third anniversary in December 2021.
The Fund, managed by Lowes Investment Management Ltd, comprises around 20 defined investment strategies with £20 million in assets under management.
The fund offers investors a portfolio of defined investment strategies, similar to those found in retail structured plans, but with daily trading and access to investments not otherwise available to retail investors. All the defined investment strategies in the Fund are linked to the performance of established stockmarket indices based on the top 100 largest companies listed in the UK.
The Fund seeks to generate returns more than those earned on cash (as measured by the Bank of England’s Sterling Overnight Index Average (SONIA) plus 5% over the medium-to-long-term.
It aims to provide capital growth in rising or modestly falling UK equities markets, while being less volatile than a corresponding investment into UK equity markets. Annualised volatility of the fund over the first three years was 16.70%, compared to the Morningstar UK index over the same period at 19.51%*.
By the end of 2021, the value of the Fund had risen by 12.32% since launch.
Doug Millward, Investment Manager at Lowes Investment Management, said: “We’re delighted to see this innovative Fund reach these milestones. Our investment team here at Lowes have a proven history of selecting the types of strategies that feature in this Fund and that perform well over time.
“The Fund is an ideal investment vehicle for financial advisers and their investors. If an investor is comfortable with structured products but wishes to diversify away from the risk of just one or two counterparties the Fund provides a solution, with the majority of the strategies collateralised with short-dated gilts, and the balance diversified across multiple counterparties. The observation dates of the strategies are also staggered over the year to provide multiple opportunities for them to mature, rather than depending on market conditions at just one or two points in the year.”
The Fund will usually invest in strategies that have a maximum duration of up to eight years. However, should the underlying stockmarket index the strategy is linked to be at or above its reference level on an observation date (usually each anniversary of the strategy’s start date), it would pay its return at that point. The proceeds would then be reinvested and this process is repeated, so the Fund continues to have exposure to many strategies that mature at different stages in the investment lifecycle.
Information on the fund can be found at https://fund.lowes.co.uk and it can be accessed daily via a range of investment platforms with low minimum investment amounts, including Aegon, Quilter, and Embark Advance.
The Fund is a sub-fund of Skyline Umbrella Fund ICAV, an Irish collective asset management vehicle structured as an umbrella with segregated liability between sub-funds, which is authorised and regulated by the Central Bank of Ireland.
* (Source FE Analytics)
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