Old Mutual Global Investors (OMGI) is to merge away Lee Freeman-Shor’s £31.1m UK Strategic Best Ideas fund into Simon Murphy’s UK Opportunities fund.
The offshore Old Mutual UK Opportunities fund, which was launched in October 2011, will be redomiciled from Ireland to the UK on 2 August 2013, and then the merger will take place on 9 August 2013.
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Both funds have the ability to employ short selling, a method of profiting when share prices fall.
A letter sent to unit holders said the firm believes it is in their best interests for the fund to be merged away.
According to the letter, the Old Mutual UK Opportunities fund is run by Simon Murphy, and the strategy has performed well with consistent positive performance, even during periods when the equity market returns have been negative.
The letter said the fund will be part of a larger, more efficient fund, as it will move from a multi-manager to a single manager approach, with a significant expected decrease in the total expense ratio.
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By GlobalDataThe UK Strategic Best Ideas fund is made up of five 10-stock portfolios run by external managers.
OMGI said moving from a multi-manager to a single manager approach would reduce costs for investors.
Freeman-Shor will continue to run Old mutual’s two similar products, the Global Best Ideas and European Best Ideas funds.
