Jupiter star manager Philip Gibbs will need to generate a higher return to obtain a performance fee this year after being forced to change the benchmark on his International Financials fund.
The group altered the benchmark on Gibbs’ long/short product earlier this month after the Financial Times Stock Exchange informed Jupiter it was to withdraw the fund’s previous yardstick, the FTSE Global Financials index.
FTSE will now use the broader All World Financials index as its primary benchmark for global financial stocks.
However, the All World Financials index has performed better than its counterpart since the launch of the Jupiter International Financials fund on 14 December last year until end July 2010, returning 3.19% against a 0.5% decline for the Global Financials index.
Gibbs’ £186m Jupiter International Financials fund, which has lost 3.14% over the same period, has a performance fee of 15% on gains in excess of its benchmark, which means the manager will have an even higher hurdle to beat in the future.
“As it was likely the withdrawal from publication of the FTSE Global Financials index would occur before the end of the fund’s first accounting period on 31 October 2010, the manager decided to adopt the FTSE All World Financials index as the benchmark for the fund with effect from launch,” Jupiter says.
“As of 2 August, the new benchmark has performed better for the fund’s accounting year to date, and hence produces a higher hurdle for the manager, reducing the amount of any performance fee charged for the year.”
