Liontrust, the specialist asset management company, is to offer investors a sustainable investment fund focused on the US. This is in response to client demand, to provide access to some of the world’s most innovative companies and to enable investors to take advantage of the opportunities for sustainable investing in the US market.
The Irish-domiciled Liontrust GF Sustainable Future (SF) US Growth Fund, which will launch in July and be Article 9 under Sustainable Finance Disclosure Regulation (SFDR), will be managed by Chris Foster, Simon Clements and Peter Michaelis and be supported by the rest of the 17-strong Sustainable Investment team.
The Liontrust Sustainable Investment team has more than two decades of experience of investing in US stocks through its SF Global Growth strategy. The new Fund will invest in between 40 to 50 predominantly mid cap stocks, with the model portfolio currently comprising 44 companies. Of these stocks, 16 are new ideas researched by the team over the past 12 to 18 months.
Chris Foster, Lead Fund Manager of Liontrust GF Sustainable Future US Growth, commented: “We have been asked by clients for many years to offer a US focused strategy and we have been able to build the resources on the Sustainable Investment team to enable us to launch the Fund now.
“The US is home to some of the world’s most innovative companies. Sustainability considerably lags Europe and the UK and the opportunity for growth over the long term is very strong.
“We also see a huge opportunity in the US for the adoption of disclosure on key environmental, social and governance (ESG) issues. We are looking to partner with the companies we are investing in over the next five years and longer to try to improve this.
“The MSCI Index is hugely concentrated. The largest 50 stocks comprise more than half the index in weight and, of these, only six will be in our portfolio. The GF SF US Growth Fund’s portfolio will therefore not be aligned with the index which is important to be able to deliver differentiated returns.
“The bulk of the portfolio will be invested in companies with market caps of $50 billion and below, which in the US are considered mid cap stocks. Some of these stocks are under-followed by both analysts and fund managers, providing active investors with opportunities.”
Since 2001, the Liontrust SF process has sought to generate strong returns from investing in companies aiming to deliver profits through positive social and environmental impacts. The managers look at the world through the prism of three mega trends – Better resource efficiency (cleaner), Improved health (healthier) and Greater safety and resilience (safer) – and then 21 themes within these.
The managers identify well-run companies whose products and operations benefit from these transformative changes and which are helping to make the world cleaner, healthier and
safer. Further analysis hones this list down to those companies that exhibit superior sustainability management, and which we believe will deliver persistently high returns on equity and are attractively valued on a five-year view.
