Factsheet: Fundsmith Equity T Acc

Global Growth

Rated Fund 2013-2018. A concentrated portfolio of big brands

Fundsmith Equity won Money Observer's Best Large Global Growth Fund award in 2016 and 2017, having previously been highly commended in 2015. It was launched in 2010 by industry stalwart Terry Smith and in just over seven years has grown to �13 billion in size.

Smith's approach is to pick a small selection of high-quality shares and stick with them. The fund currently holds just 29 shares, with over 60 per cent in the US market. He likes to buy long-established firms with big brands. The fund's largest investments include household names such as PayPal, Microsoft and Dr Pepper Snapple. Only a handful of holdings have been changed since the fund's inception.

Other qualities he looks for in companies are a high return on capital and advantages that are difficult to replicate. Smith believes it is virtually impossible to predict which way stock markets will move, but that the strength of the companies the fund holds will allow them to continue to grow their intrinsic value.

He is sceptical when other managers talk about diversification, or when they voice the belief that they can buy poor-quality companies when their fortunes and share prices are depressed but about to improve, or sell them close to their peak.With regard to such market timing, he says the performance record of the vast majority of active managers would suggest that there are far more who think they can play the investment and business/economic cycle successfully and outperform, than can actually do so.

Narrative and ratings content all as of 01 January 2018.

See all Money Observer rated funds
Name
Fundsmith Equity T Acc
Manager
Fundsmith LLP
Type
Open Ended Investment Company
ISIN
GB00B4Q5X527
Sector
Global
Launched
01/11/2010
OCF
1.05 %
Risk Rating
3
3 Year Sharpe
1.54
3 Year Alpha
6.46
Yield
0.6 %
Benchmark
MSCI World NR GBP
The fund’s objective is to achieve long term growth in value, investing in shares of companies on a global basis. The fund’s approach is to be a long-term investor in its chosen stocks and it will not adopt short-term trading strategies. The fund aims to invest in businesses: • that can sustain a high return on operating capital employed; • whose advantages are difficult to replicate; • which do not require significant borrowing to generate returns; • with a high degree of certainty of growth from reinvestment of their cash flows at high rates of return; • that are resilient to change, particularly technological innovation; • whose valuation is considered to be attractive; The fund will not invest in derivatives nor hedge any currency exposure.
Holding %
C.R. Bard Inc 5.52 %
Amadeus IT Group SA A 5.14 %
IDEXX Laboratories Inc 5.11 %
Stryker Corp 4.92 %
Microsoft Corp 4.88 %
PayPal Holdings Inc 4.41 %
Intercontl Hotels 4.40 %
Waters Corp 4.25 %
PepsiCo Inc 4.24 %
Philip Morris International Inc 4.08 %
Region %
United States 65.06 %
United Kingdom 19.77 %
Eurozone 10.18 %
Sector %
Consumer Defensive 33.44 %
Healthcare 30.31 %
Technology 13.33 %
Industrials 10.44 %
Financial Services 7.91 %
Name
Fundsmith LLP
Address
W1G 0PW, London, United Kingdom
UCITS
Yes
Legal Structure
Open Ended Investment Company

Managers

Terry Smith
Joined 11/01/2010

Terry Smith graduated in History from University College Cardiff in 1974. He worked for Barclays Bank from 1974-83 and became an Associate of the Chartered Institute of Bankers in 1976. He obtained an MBA at The Management College, Henley in 1979. He became a stockbroker with W Greenwell & Co in 1984 and was the top-rated bank analyst in London from 1984-89. In 1990 he became head of UK Company Research at UBS Phillips & Drew, a position from which he was dismissed in 1992 following the publication of his best selling book Accounting for Growth. He joined Collins Stewart shortly after, and became a director in 1996. In 2000 he became Chief Executive and led the management buy-out of Collins Stewart, which was floated on the London Stock Exchange five months later. In 2003 Collins Stewart acquired Tullett Liberty and followed this in 2004 with the acquisition of Prebon Group, creating the world's second largest inter-dealer broker. Collins Stewart and Tullett Prebon were demerged in 2006 with Terry remaining CEO of Tullett Prebon until September 2014. In 2010 he founded Fundsmith where he is CEO and CIO. In 2012 he was appointed a Member of the New Zealand Order of Merit for services to New Zealand-UK relations following the success of his campaign to commemorate the New Zealander, Air Marshal Sir Keith Park."

Data provided by Morningstar.

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