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Capital Group launches UCITS fund based on new perspective strategy


Prompted by research that UK domiciled companies generate an average 71 per cent of their revenue from overseas markets, Capital Group has launched the Capital Group New Perspective Fund (LUX), a Luxembourg-domiciled UCITS fund, in Europe and Asia. 

Based on the belief that looking at the origin of a company’s revenue streams, rather than just its country of domicile, can provide a greater understanding of investment opportunities and risks, the new perspective strategy has proved successful in the US and is now available to European and Asian investors.

While it has long been known that companies are active beyond their country of domicile, the percentage of revenues firms generate from other countries may surprise some investors. As well as an average 71 per cent1 of FTSE 100 revenues being generated outside the UK, Swiss companies listed on the SBI generate 93 per cent of their revenue outside of Switzerland, and in the Netherlands 89 per cent of the revenues generated by companies on the AEX Index come from outside the country. 

“The analysis demonstrates that investors might benefit from using revenue, in addition to where a company is listed, as a proxy for where a company does business, and thus a company’s prospects,” says Rob Lovelace, a portfolio manager for Capital Group New Perspective Fund (LUX). “The fact that most revenues continue to come from outside the UK confirms that investors should consider looking beyond traditional boundaries, because local factors don’t necessarily influence company revenues. In an integrated global economy, the beneficiaries of improving economic conditions may not necessarily be located in close proximity to that recovery.”

Kevin Clifford, Head of Global Distribution at Capital Group, commented: “We are excited to be launching this fund today, which demonstrates our focus on making it as simple as possible for our clients in Europe and Asia to access the very best of Capital Group’s capabilities. Capital is committed to Europe and Asia and we are particularly pleased that investors in these markets will be able to benefit from a strategy that has produced a track record of superior, consistent results for more than 40 years in the US.”

Capital Group’s New Perspective strategy focuses on investing in blue-chip-quality companies from around the world, identifying the emerging multinationals of the future, as well as those established multinationals that are well positioned to benefit from secular growth trends and global trade patterns. The Luxembourg-domiciled fund (UCITS) will consider the source of a company’s revenue streams, as well as the country of domicile, in order to gain a greater understanding of the investment opportunities and risks. Through identifying changing global trade patterns and companies that are able to reshape the competitive landscape, the strategy has outpaced the market since inception in the US. As at 30 September 2015, the strategy has delivered a return of 4.8 per cent above the MSCI All Country World Index (net dividends reinvested) over its 42-year lifetime in the US.

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