Bringing you live news and features since 2006 

Liontrust European Long/Short Fund gains UK distributor status


Liontrust has gained distributor status in the UK for the Liontrust European Long/Short Fund.

Liontrust has gained distributor status in the UK for the Liontrust European Long/Short Fund.

The fund is managed by Gary West and James Inglis-Jones (photo) and has around USD87m in assets.

Liontrust says distributor status is advantageous for UK investors because it means gains from the Guernsey-domiciled and Dublin-listed Liontrust European Long/Short Fund are subject to investors’ capital gains tax rather than income tax.

In contrast, gains from hedge funds and offshore funds without distributor status are subject to income tax for UK investors.

The 18 per cent rate of capital gains tax is attractive compared to the 40 per cent income tax rate for top rate taxpayers, and distributor status also enables investors to take advantage of capital gains tax allowances.

From launch on 6 December 2006 up to the end of 2008, the euro share class of the fund, which is only open to professional investors and has a minimum investment of EUR100,000, returned 44.58 per cent. In 2008, the euro share class of the fund returned 11.32 per cent.

The fund is non-directional and has had a low correlation in its returns to both European stock markets and other European long/short funds.

The European Long/Short Fund is based on the same investment philosophy as the UK-domiciled long only Liontrust Continental Europe Fund, known as the Cashflow Solution.

The objective of the Cashflow Solution is to exploit opportunities created by the failure of company managers to forecast profits accurately. The Liontrust European Long/Short Fund buys companies with good cash flows that are likely to beat investors’ low profit expectations and sells short expensive companies with unexpectedly poor earnings potential.

To help the managers achieve this, two cash flow measures are used: cash flow relative to operating assets and cash flow relative to enterprise value.

‘The Liontrust European Long/Short Fund has been well received by discretionary and fund of funds investors,’ says Rob Page, marketing director at Liontrust.

‘Gaining distributor status will make the fund even more attractive to professional investors in the UK. We believe the fund is particularly attractive given that it delivered a return of 11.32 per cent in 2008 at a time when most hedge funds and long only funds suffered significant losses.’ 

HM Revenue & Customs has announced it plans to reform the offshore funds regime, with a new reporting regime expected to replace the distributor status regime.

Liontrust says it plans to comply with any new reporting regime to ensure there is no change in the tax status of gains from the Liontrust European Long/Short Fund for investors.

Latest News

US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Ed Rosenberg, Texas Capital
Texas Capital Bank first opened its doors back in December 1998 and nowadays offers wealth-management services, as well as commercial,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by