Financial services firm Barings has converted its dedicated charity fund, the Barings Targeted Return Fund, to a Charity Authorised Investment Fund (CAIF).
Barings Targeted Return Fund is a daily dealing fund with a minimum investment of £10,000. The new CAIF structure will bring cost benefits to clients by allowing for VAT to be waived on the management fee, while the Fund’s Annual Management Charge has been reduced from 0.5% to 0.4%, leading to a reduction in the fee by a third with the VAT benefits from the CAIF structure taken into account.
As both an investment fund and registered charity, the move to the CAIF structure means the fund will now comply with both FCA and Charity Commission regulations.
There will be no change to the investment process and the Fund will continue to be managed by Alison El-Araby and Malcolm Herring, who are supported by members of Barings’ Multi Asset Group.
Malcolm Herring, Head of Charities in the Multi-Asset Group at Barings, and co-manager of the Fund said:
“This change demonstrates Barings’ continued commitment to the Fund, bringing it up to date with the modern approved regulatory structure. The new structure and lowering of the Annual Management Charge make the fund a more competitive and compelling offer to our charity clients.”
The Fund achieved a return of 13.7% (net of fees) in 2019. Since inception over a decade ago, the Fund has delivered a return of 7.0% per annum (net of fees). It targets income and capital returns that, after fees, exceed the Consumer Price Index (CPI) by at least 3% per year when measured over a full cycle of typically five to 10 years. This includes income exceeding the CPI by 1% per year.
The Fund is constructed with asset allocation at the fore, with the portfolio comprising stocks and bonds from a range of companies, geographies and sectors. Environmental, Social and Governance (ESG) factors are incorporated throughout the investment process, at the overall asset class level and with individual investments. The Fund incorporates ethical considerations and does not invest directly in tobacco stocks.
Alison El-Araby, Investment Manager in the Multi-Asset Group at Barings and co-manager of the Fund, added:
“The key to success is good strategic, dynamic asset allocation. We seek to participate in up-markets and protect in down-markets as we believe this is an effective way for investors to grow assets while experiencing reduced volatility.”
Get free email updates
Keep up to date with fundraising news, ideas and inspiration with a weekly or daily email. [Privacy]