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Evelyn Partners Core MPS reduces ongoing costs by 27%

The team has added to existing positions in funds including Baillie Gifford Japanese Fund, Stewart Investors Asia Pacific Sustainability Leaders and iShares Core FTSE 100

In its latest re-balance of portfolios, the Evelyn Partners Core Managed Portfolio Service (MPS) team has reduced exposure to global equity funds in preference for country or sector- specific funds. It comes as recent changes have reduced OCFs by 16 basis points on average across the range, equivalent to a 27% cost reduction.

The re-balance has also seen the Fundsmith Equity, Brown Advisory Global Leaders and Fidelity Emerging Markets funds fully exited, with the global proceeds split across geographies to reflect house asset allocation views.

In addition, the team has added to existing positions in funds including Baillie Gifford Japanese Fund, Stewart Investors Asia Pacific Sustainability Leaders and iShares Core FTSE 100. New positions include Premier Miton UK Multi Cap Income and Federated Hermes Global Emerging Markets, as well as Ninety One UK Alpha, which has been a key holding in the Active MPS range for a number of years.  

While reducing overall exposure to global equity funds, which typically have a majority of their exposure to US equities, the team has reportedly retained its holdings in iShares Edge MSCI World Quality Factor ETF in the Defensive Model and the TM Evenlode Global Income fund in the two income models.  

Meanwhile, changes have also been made to the team’s Absolute Return holdings. Janus Henderson UK Absolute Return and Trojan Fund have both been exited, and NB Uncorrelated Strategies and Fulcrum Diversified Absolute Return have been introduced. 

James Burns, lead manager of the Evelyn Partners Core MPS, said: “By using country specific funds we are able to more closely reflect our in-house tactical asset allocation guidance which is cautious on US equities. Interestingly, the global funds exited were also some of our more expensive ones and replacing them has helped bring down the overall OCFs in the models, alongside the addition of three additional passive funds.

“While the latest changes were driven by investment views, the combined impact of removing some of the higher fee global funds, introducing three additional passive funds and our strengthened buying power has had a significant effect in terms of reducing ongoing costs. Since May, ongoing costs on the portfolios have reduced by 27% in total, with the average OCF falling from 0.58% to 0.42%.”

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