Witan (WTAN) has announced that, following a review of its performance benchmark, it will tweak the allocation from January 2020. The effect be to give the benchmark a more global bias. In summary, the new benchmark will be 15% UK (FTSE All Share Index), which with previously 30%; and 85% Global (FTSE All World Index), which was previously 70% and comprised fixed percentages of four international indices).
A natural evolution
Witan says that its benchmark, which is used as a reference point for comparing performance, has evolved over time to reflect changes in the investment universe from which most of the portfolio holdings are chosen.
The separate UK benchmark component, which has reduced in three stages from 60% in 2004 to the current level of 30%, will be 15% from 2020. The effective UK benchmark content will be c 19% since, in addition to the specified 15% in the UK, the global index has a 5% weighting in the UK.
The second change taking effect from 2020 is a simplification of the overseas element of the benchmark to a single index (the FTSE All World Index) from the previous composite benchmark. This is intended to make it easier for investors to monitor.
The Company’s portfolio is not designed to track any index or combination of market indices. It is actively managed, with decisions on investment being distinct from the benchmark used for performance comparison. The Company’s managers invest in companies on the basis of their shares’ potential to deliver above-average returns and to outperform market indices. The Company’s portfolio will continue to differ materially, at the stock, sector and geographical level from the composition of the benchmark.
New benchmark is more reflective of opportunities in the global economy
The Company says that it believes that the new benchmark is more reflective of the range of opportunities in the global economy and that shareholders will benefit in the long-term from exposure to a more international investment universe. The Company’s investment objective of delivering long-term growth in income and capital remains unchanged.
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