Categories:

Fundsmith Equity Fund: a look at its drivers

Open-end | Review | Global | 13 Mins Read | by

A A A

The Fundsmith Equity Fund launched on 1 November 2010 and the fund size at the end of that month the fund size was £39 million. The fund had £16.6 billion under management eight years later at the end of January 2019.

The key question is whether the Fundsmith Equity Fund can continue to outperform given its size and fee structure.

 

Size matters when it comes to investment funds. Large funds have a smaller investment universe of stocks that can move the needle. This makes it harder to outperform.

It is not worth the candle anymore for Fundsmith to invest in a £4 billion company. A 10% stake in a £4 billion business will have little impact on the Fundsmith Equity Fund.

Fundsmith Equity I Acc* since inception

Source: SharePad, *Institutional accumulation class.

Sign up to read full article.

Get FREE access now

Already a member? Login

Source: SharePad

Passive fund alternative

Closed-end active fund alternative

Source: SharePad