Asked by Anonymous
Asked 2w ago
How can I invest in Fundsmith global and is that fund really good? Considering that fund with high expense ratio should be avoided should I still be looking at funds?
On the one hand the current track record (5 years) seems super and their proposed strategy (longterm, growth stocks) also attractive,sure enough however:
-with more than 1.0% annual fees it is still expensive by todays standards -it comprises a majority of tech sector stocks so the benchmark (international equity) depicted in the fundprospect's chart is flawed -it is potentially underdiversified (only 28 holdings) so maybe good luck by picking some really superperforming stocks could have led to it's hitherto excellent performance
I add a 5 year Chart where we can see that the T class non-accumultating outperformed the U.S. SP500 Growth ETF but underperformed compared to the large & cheap tech ETF VGT
... then, given all the evidence by studies, i doubt that (for stocks) active management has still it's place ...
I was also looking at this sometime back. like their investment thesis and decent fund charges (~1-2%). to me, this is something which i find have the potential and will buy and hold forever.
" Just a small number of high quality, resilient, global growth companies that are good value and which we intend to hold for a long time, and in which we invest our own money. "
however, as retail investors, we can only buy this fund from fund platform providers, which somehow there will be some sort of fees (whether is it platform fees, sales charge, annual, or whatsoever). further, there is no S$ hedge share class. therefore I decided to skip this fund.
nowadays, i hardly look at unit trusts anymore largely because of fees, not just expense ratio. better ones (in my opinion anyway) are sold through platforms (high fees!). Banks have lower fees, but they only sell normal funds.
Not saying normal funds cannot perform, but I just do not see the need to buy funds where there are other options readily available.
Hope this helps.
Top Contributor (Jan)
Fundsmith Equity is available via Investment Linked Platforms. The cheapest way to purchase it would be via a one time sales charge AXA Single Premium policy. No ongoing platform fees, etc.
Active management still has its place. Yes they cost more than passive index trackers but what you pay for is alpha or a better risk adjusted return.
The great thing about Fundsmith is about how simple the fund actually is.
It only holds 30 global counters in strong companies with good fundamentals. I'd suggest watching videos of Terry Smith explain the fund. No hedging, no betting, no nonsense as he says.
Majority of my equity holdings are with Terry's fund.