Nimmo overweights UK favourites in Global Smaller Companies fund

Standard Life Investments’ Harry Nimmo is set to run a significantly overweight position in the UK when his Global Smaller Companies fund launches on 18 January.

Nimmo said a number of his favourite UK stockpicks will have prominent positions in SLI’s new global offering.  “The favourite stocks from the UK and European Smaller Companies funds will be held in the new fund with a heavy UK overweight compared to the index – in which the UK accounts for just 7%,” he said.

“As with my UK Smaller Companies fund, I will be employing a strategy of targeting companies which have the potential to become world leaders in their respective sectors.”

Nimmo said the portfolio will comprise 40-80 holdings, with 50% of the fund in the US, 25% in the UK and Europe, and the remaining 25% in the rest of the world. 

“The US is 50% of the index so it is important to have a large allocation, but we will not be replicating the index, as for instance we will have minimal exposure to Japan, which is 10% of our benchmark.”  

The manager will also run overweight positions in industrials and consumer services; the two largest sector plays in his top quartile £1bn UK Smaller Companies fund.

The manager added the new fund will be underweight property, which is the biggest sector in the benchmark MSCI All Country World Small Cap index, as he is focused on capital appreciation rather than income. 

Nimmo said the fund’s global remit will give him greater flexibility to purchase tech-savvy companies which successfully harness the internet within their businesses.

The fund has a minimum investment of £500 for retail investors, with an initial charge of 4% and AMC of 1.7%.