Cazenove’s UK Smaller Companies Fund – Closed to new business

Schroders

You may have received a letter about your investment in Cazenove’s UK Smaller Companies Fund.  Skandia were first out of the blocks, sending out their letter on 27th December 2013.  Cofunds and Fidelity customers were notified in late January with a few later letters from other providers.

Here’s an extract of our update to our policyholders, issued on 13th January.

Regular Investors got this:

You may have received a letter as an investor in Cazenove’s UK Smaller Companies fund.  We need to take action before your February contribution into your plan.   The fund is closing to new business because it is (in plain English) ‘full’.  In other words, the fund managers feel that too much money is flowing into the fund so they have decided to halt new investments.

I have already researched and selected Franklin’s UK Smaller Companies fund as an alternative with a very similar investment remit, having checked that they are not planning a similar fund closure.  The Key Investor Information Document (KIID) is enclosed for your information.

The default solution would be to redirect that part of your contribution into the cash fund until our next review.  This option has no cost to you.  The cash fund is very low risk, intended as a short-term solution.  The cash fund value is unlikely to fall if the markets fall, and it is unlikely to keep pace with inflation or do better than inflation even if markets rise.  I’m sure you agree that it is preferable to maintain your investment mix immediately.

Lump Sum Investors got this:

In preparation for the next quarterly review, I have selected Franklin’s UK Smaller Companies fund as an alternative with a very similar investment remit, having checked that they are not planning a similar fund closure.  The Key Investor Information Document (KIID) is enclosed for your information.

Our next quarterly portfolio review will be the ideal opportunity to replace the fund and I am updating our factsheets on that basis.  If you would like to discuss Skandia’s letter further, please contact me.

In order to expedite matters, we are not undertaking a “full advice” process and we are limiting our advice to the very specific recommendation to switch out of the Cazenove UK Smaller Companies fund at this time. If your circumstances have changed in any way or you feel that you would benefit from discussing this recommendation please do contact us.

Call on 0161 028 2706 or email on info@parsonagefinancial.co.uk

 

Sean Maudsley-Barton

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