Fund Brief Case Study: Fundsmith Equity Fund

A) Fund backdrop

- Mandate:  Blue-chip Western companies. This offers a relatively "large pond to fish in."

- Investment Style: Quality companies.  It is easier to compound value if the underlying companies are also doing so.

- Manager: Mr Smith and his team are not new to equity markets and have a clear approach.

B) Fund Holdings

- High quality and relatively low risk companies such as PayPal and the airline ticking company Amadeus.

C) Fund drivers

- Asset class: The fund has a strong exposure to the US.

- Sectors: The focus is on high quality sectors with a number of sectors excluded (i.e. banking and real estate).

- Themes: While the fund does look at themes (travel, healthcare, payments) the focus is to find attractive companies.

- Potential downsides: size of fund may make outperformance harder and open-end structure.