Foreign & Colonial, which is now managed by Paul Niven (pictured) has released its interims. these cover the first half of 2014. Over that period the net asset value rose by 1.1% and the share price return was 0.8%. By comparison the benchmark return was 3.2%.
The UK, North American, European and Emerging Market equity portfolios underperformed comparable indices (UK falling by 4.1% while the index rose by 1.7%, North America +2.1% vs. +4.1%, Europe -1.0% vs. +3.0%, and Emerging Markets +3.5% vs. +3.8%). The Japanese equity, Global income and Global funds portfolios outperformed (Japan -0.8% vs. -1.9%, Global Income +5.5% vs. +3.2% and Global Funds +3.4% vs. +3.2%). The private equity portfolio returned 5.7% and generated net cash flow of £39m. A new Global multi-manager portfolio returned 1.8% for the period from its inception on 1 April 2014.
The manager’s report says that the biggest detractor from performance during the period was stock selection – this cost the fund 2.1%.
The forecast for the year is that Foreign & Colonial will pay three interim dividends of 2.2p per share and a final dividend of 2.7p – this represents an increase of 3.3% over the previous financial year.
The manager shifted £250m out of the UK equity portfolio into a global portfolio of funds and European equities. They also cut the fund’s overall gearing level to 7%.