SJP announces changes to its £14bn Global Equity Fund

by | Nov 19, 2021

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  • A lower carbon footprint that will be half that of the fund’s benchmark at launch
  • Lower cost solution with investment manager fees decreasing by 0.12 percentage points to 0.10% per annum
  • Three new investment strategies offering greater diversification across styles
  • Actively managed element of the fund increases from 40% to 66%

St. James’s Place today announces changes to its Global Equity Fund to take effect from 22 November 2021, which will see the fund access wider opportunities for clients across the global equity opportunity set whilst bringing the fund in line with the firm’s criteria for responsible investing and net zero commitments.

State Street Global Advisors, Man Numeric, and LA Capital will manage three new strategies, each with equal weighting, aimed at providing a balanced style profile. The actively managed element of the fund increases from 40% to 66%, while the removal of a constraint to track the MSCI All-Country World Equal Weight Index will help provide more balanced regional, style and market capitalisation exposures.

State Street will manage a bespoke passive strategy designed to correlate closely to the new benchmark. Man Numeric and LA Capital will manage an active quantitative strategy that uses data analysis alongside experienced teams to deliver outperformance.

 

The managers have proven track records in integrating responsible investing and Environmental, Social and Governance (ESG) factors into their investment processes and offer greater diversification of investment styles and exposures. The new investment approach will look to deliver smoother, more consistent returns for clients, with additional aims such as reducing the carbon footprint of the fund, which is anticipated to be half that of the benchmark at launch.

Rob Gardner, Director of Investment Management at St. James’s Place, says: “We believe this will be a key part in helping us fulfil our promise to our clients of delivering financial wellbeing in a world worth living in.

“As a £14bn fund, we have been working hard on these changes over the last few years and we are delighted to evolve it in a way that can reduce its overall carbon footprint.  On a standalone basis, it becomes one of the largest of its type to integrate ESG factors into its decision-making processes, both to find investment opportunities and mitigate risks.”

 

Tom Beal, Chief Investment Officer at St. James’s Place, says: “One of our core investment beliefs at SJP is that responsible investment is a crucial element of achieving long-term, sustainable returns. These changes will see the fund evolve into a lower cost solution that aligns to our principles on responsible investing and our net zero commitments.

“We are appointing three new managers – State Street Global Advisors, Man Numeric and LA Capital – whose complementary strategies will allow us to access the full range of opportunities available in global equity markets.

“The diversified, index-aware structure of the fund means that it captures many of the benefits of passive investing, whilst retaining the potential to moderately outperform its global equity benchmark over the long-term.

 

“We want our managers to actively own the businesses they invest in so, to facilitate that, they will significantly reduce the number of underlying companies in the fund in comparison to the broad market. The fund will continue to allocate to all of the underlying industries within the benchmark but will look to bias its exposure to companies with strong ESG credentials and those that are transitioning to Net Zero.”

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