Trojan Ethical Income Fund
The investment objective of Trojan Ethical Income Fund is to seek to provide income with the potential for capital growth in the medium term. Its investment policy is to invest substantially in UK and overseas equities. Trojan Ethical Income Fund may also invest in fixed interest securities, indices, deposits, collective investment schemes and money market instruments.
The fund will invest in accordance with the parameters of its ethical investment criteria, which consider ethical issues in relation to: fossil fuels, pornography, tobacco and certain types of armaments. A document setting out the fund’s ethical investment criteria is available here.
In addition to the O share class referred to on this page, I & S Classes are also available. Please contact us for more information.
Derivatives may be employed for the purposes of efficient portfolio management.
Investment Performance will not be shown until one calendar year after the fund's launch due to regulatory requirements. Similarly, no information relating to Trojan Ethical Income Fund is included in either the Interim Report or Annual Report.
|'O' Share Class||Price 17/07/2018|
The Fund produced a return of +0.7% during the month, compared to -0.2% for the FTSE All-Share Index (TR).
As US interest rate expectations rose, and the outlook for Sino-American trade relations deteriorated, the market rally that had dominated much of the previous two months faltered. Reassuringly, the Fund’s consumer staples stocks delivered a robust performance over this period. The more modest multiples on which these stocks now trade is a key factor in determining the resilience of their share prices.
It is also valuation that has driven us to exit the Fund’s holding in Burberry. We first bought the stock two years ago. At that time a depressed Chinese consumer and weak management structures had precipitated a share price fall that left this iconic brand trading on 16x earnings and a 3.5% yield.
Since our purchase, the demographic forces that underpin Chinese consumer spending have re-asserted themselves and both a new chief executive and creative director have been appointed. These, and other developments, have driven the Burberry share price materially higher, leaving the stock now trading on a ten-year price/earnings multiple high of 27x and a yield of less than 2%.
The long-term future of the Burberry brand has probably altered only modestly during the last 24 months. However, we believe that the potential returns available to investors in the company’s shares have diminished materially thus prompting us to sell the Fund’s holding.
|Top 10 Holdings||Fund (%)|
|Procter & Gamble||3.1|
|Total Top 10||36.6|
|35 other holdings||52.7|
|Cash & equivalent||10.7|
How to Invest
You may invest directly, via a broker or adviser, or through a number of online fund platforms.
- Fund Manager
- Inception Date
- Available Share Class
O, I, S
- ISIN (O Class)
- Bloomberg (O Class)
- Sedol (O Class)