It has been a week or so that Montgomery Global launched its first open-ended quoted global equity fund, named Montgomery Global Equities Fund, which will trade on the Australian Securities Exchange (ASX) under ticker MOGL around 20 December 2017.

The initial offer that has a minimum application of $10,000, opened at the end of November 2017 and will close on 14 December 2017. Macquarie Equities is acting as market maker for the quoted fund.

Risk or reward related Offerings: The fund has been said to offer self-managed super funds (SMSFs) and other investors, brokers, and advisers, an opportunity to invest in global businesses through an actively managed portfolio of global companies (15-30) with one trade while the key focus is on fast growing sectors. The fund intends to particularly strategize having extraordinary under-valued global companies that are not thematically available on the ASX, and this does pose some risk in terms of information available with regards to the performance of such companies. On the other hand, the companies might showcase great value that has been untapped previously. The fund has five of its biggest portfolios positions in companies with market cap of less than a $10 billion. An example would be of Jupiter Fund Management in which Montgomery Global Funds owns shares. Jupiter has been said to be a high quality active manager of assets (including equities and fixed income) that banks on high quality active managers and a multi-channel distribution platform with an institutional-grade operational approach enabling Jupiter deliver returns on equity of about 40 per cent from its underlying business (excluding excess cash).

Notwithstanding the above, the aim is to deliver long-term capital growth and outperform the MSCI World Net Total Return Index over a rolling five-year period.

Good Distribution: The fund has been slated to provide a minimum annual distribution yield of 4.5 per cent, which will be paid semi-annually.

Managing Risk: Considering some level of uncertainty, the fund targets high-quality global businesses that trade at striking valuations and aims to retain the ability to hold up to 30 per cent in the safety of cash.

While the rewards look high, risk also prevails with regards to the companies (which target for high growth) that fund will have an exposure to. Considering the scenario, there is a lot of speculation given the minimum offer amount. Thus, investors with high risk appetite might want to evaluate further and take a punt.
 

Terms of the Offer (Source: Company Reports)

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