Latin America's development bank CAF doubles investment target for marine ecosystems
June 7 (Reuters) - The Development Bank of Latin America and the Caribbean said on Saturday it will invest $2.5 billion in the region's so-called blue economy by 2030 to ensure the sustainability of marine and coastal ecosystems.
The new goal, announced on the sidelines of the Blue Economy and Finance Forum in Monaco, doubles the bank's previous target of investing $1.25 billion between 2022 and 2026. The bank has already committed $1.32 billion.
Funded projects so far include marine sanitation initiatives in Ecuador, Brazil, and El Salvador, as well as energy transition efforts in Ecuador's shrimp farming sector, among others, the bank said in a statement.
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Daily Mail
4 hours ago
- Daily Mail
GUINNESS EUROPEAN EQUITY INCOME: Forgotten fund turning gems into £100m moneymaker
After more than 11 years, Guinness European Equity Income is emerging from the shadows. Having been left to lie fallow as a result of the success of its sister fund Guinness Global Equity Income, it is beginning to gain some traction with investors and wealth managers. The fund, valued at a meagre £8 million a year ago, has now broken through £50 million. And co-fund manager Will James is confident it won't be long before it gets to £100million – maybe by the end of this year, but more likely within the next 12 months. To put these numbers into perspective, Global Equity Income, launched three years before European Equity Income, now has £4.9 billion of assets under its wing. 'The fund has momentum,' insists James. 'It's six times bigger than it was a year ago and it's in growth mode. It's rather encouraging.' James, who joined Nicholas Edwards on the fund in early 2024, believes one of the key drivers has been an improvement in the wider investment case for Europe. He says: 'As an investment proposition, Europe struggled to compete with US exceptionalism for many years. The result was that most investors' portfolios were underweight in Europe. 'But that US exceptionalism has now unwound, resulting in the appeal of dividend-friendly European companies being brought to a wider investor audience.' The fund's focus is on identifying European companies that are undervalued but which have strong balance sheets and cash flows largely impervious to the state of the economic backdrop. It side-steps businesses which have lots of debt. All these demands reduce an investible universe from 1,400 down to 200. Like other Guinness funds, European Equity Income then builds its portfolio around just 30 stocks, with holdings having broadly equal weightings. If a new company is brought into the fund, one has to be pushed out. The fund's exposure is determined by the companies it buys, not a view on the relative attractiveness of individual markets. This year, stakes in two businesses have been sold: Swiss-Swedish electrical engineering giant ABB and Finnish IT software company Tietoevry. They were replaced by energy technical specialist SPIE and Dutch-based BE Semiconductor Industries. James says: 'SPIE is generating an attractive dividend, and its work is essential in improving Europe's electrical infrastructure. 'BE Semiconductor Industries is a specialist in hybrid bonding, a process which enables semiconductors to be built that are more powerful and efficient than ever before.' Fund changes are infrequent – two holdings were sold last year, three the year before. Eight stocks have been in the fund from the word go, including Finnish industrial company Konecranes, Norwegian fish farm specialist Salmar, London-listed Unilever and French consumer staples business Danone. The fund's performance numbers stack up. Over the past one, three and five years it has outperformed the average for its peer group. Over five years, returns of 71 per cent compare with 56 per cent for the average European fund. Income is paid twice yearly and it has been in growth mode since 2020. An annual dividend last year of £6.21 a share compares with £3.13 in 2020. Later this month James and Edwards will meet financial experts in Bournemouth, Bristol and Leicester – all part of a mission to get the fund to £100 million. Annual fund charges are reasonable at 0.89 per cent and the annual dividend is around 3.6 per cent.
Daily Mail
4 hours ago
- Daily Mail
The expensive funds that ARE worth paying for
If there's one thing that's guaranteed to gnaw away at your wealth, it's fees on the funds you invest in. Managers take a slice of your investments every year – and the more they take, the less there is left for you. The impact can be dramatic. If you put £10,000 in a fund that earned 6 per cent a year, you would be sitting on £38,131 after 25 years if the annual fees were 0.5 per cent. But if fees were 1 per cent you'd have just £33,865, and if they were 2 per cent you'd have £26,662 – and would have paid £16,250 in fees. So why would you ever pay fees for a fund that are several times higher than others that hold investments in the same sector? We investigated if it's ever worth paying for the most expensive funds available. What is expensive? Fierce competition and regulatory pressure have forced down fees over the past decade to ensure that investors get a better deal. Actively managed investment funds – those curated by an expert – now charge an annual fee of 0.89 per cent on average, according to regulator the Financial Conduct Authority. Passive funds that follow an index instead of relying on experts are cheaper still – sometimes as low as 0.1 per cent a year. But research for Wealth & Personal Finance reveals there are still 255 funds that charge 1.5 per cent or higher. Their annual charge is a hefty 1.69 per cent on average, compared with the average across their rivals of 0.66 per cent. For every penny more an investor pays in charges, the manager must produce greater returns to outperform the market. Analysis of the funds by research firm Morningstar shows they don't always manage it – but some do. Some 17 of the 255 dearest funds were in the bottom 10 per cent (decile) of performers in their fund sector over one, three and five years. A further 10 were in the bottom decile for two out of three of these time periods. But several funds have consistently outperformed. Eight funds were in the top decile of their sector in all three time periods, and a further seven were top in two out of three of the periods. The Artemis UK Select fund, for example, charges 1.55 per cent compared to an average charge of 0.4 per cent across the UK All Companies sector. It is a top performer over all three time periods and has delivered annualised returns of 19.5 per cent over five years. The Schroder Income fund charges 1.64 per cent, more than double the 0.8 per cent average for its peer group. Over five years it has produced annualised returns of 15.3 per cent, putting it in the top decile of its sector. Ben Yearsley from fund experts Fairview Investing says: 'There is an unhealthy obsession with fees, but the fact is there is no real correlation between charges and performance. If you can deliver consistently after fees, regardless of what the market is doing, then does it matter what the fee is?' When it is worth paying more Darius McDermott, from ratings agency Fund Calibre, says: 'No one should say that charges don't matter, because they do, but the more important question is: did you pick the right fund? Because the right fund will still outperform, even if it is more expensive.' The first check to decide if it is worth paying for an expensive fund is to compare it to similar ones. If you can find another fund doing the same thing for much less, consider switching. Take a look at the annual performance after fees. If the performance is higher even when fees are factored in, it may be worth the money. Also check how much money is invested in the fund – a statistic known as the assets under management (AUM). This information should be easily available in the fund's key investor information document. Smaller funds are sometimes justified in charging more because many of the running costs are fixed, such as the authorisation and legal costs. However, as the fund grows they should pass on the savings, says Yearsley. 'Funds should be passing on the economies of scale as they grow – a £20 billion fund charging 2 per cent would be hard to justify,' he adds. Funds in specialist areas, such as property or infrastructure, may also have higher costs, which are passed on to investors. When checking how well a fund is doing, Yearsley recommends that you should look at the performance across individual years, rather than cumulative figures across several. 'This will help you see a pattern: whether the fund is routinely under- or over-performing, rather than having one very good or bad year that has distorted the overall picture,' he says. These figures can be found on the fund factsheet or through investment platforms and fund research websites. ...and when to switch Paying more does not always get you more – you may be able to invest in the same fund for cheaper simply by switching share 'class'. Some funds have several share classes, which are the same except for their price. Older, so-called 'legacy' share classes, tend to be more expensive because they were created before regulation forced fund managers to strip out commission fees and other excess charges from the cost of investing. Ask your investment platform or contact the fund firm if you are not sure if a cheaper version is available. McDermott points to the Jupiter India fund as one example. It is a top-performing fund, but investors in its most expensive L share class have seen returns of 166 per cent over five years, while those in its cheapest X share class enjoyed 180 per cent returns. 'Even the most expensive share class has beaten the market, but it does still affect your returns,' says McDermott. 'The greater the performance, the bigger the impact of the charges.' So how do funds justify their higher fees? Toby Gibb, head of investment solutions at fund house Artemis, says it is doing its best to encourage investors out of more expensive share classes and that most were now in cheaper versions. He adds: 'If managers are to do better than the market, they must conduct huge amounts of research, and often need specialist external research too. We think the long-term performance of these funds demonstrates that that's worth paying for.' A Schroders spokesman says: 'Our goal is to ensure that clients are invested in the share class that provides the best value based on their investment approach. 'We conduct a semi-annual automatic conversion to cheaper share classes for investors that have had their adviser removed.' Jupiter has been approached for comment. How to work out what you're paying Check the fund factsheet. This should list the annual management charge (AMC), which is displayed as a percentage. It might also be called the ongoing charge figure (OCF) or total expense ratio (TER). Check which share class you are in. Some investment platforms offer cheaper share classes, so you will need to check with your platform exactly what you're paying. Don't forget other fees. Remember the fund charge is on top of your platform fee, so factor this into calculations when considering the overall cost of investing.
Telegraph
9 hours ago
- Telegraph
Councils fly flags to support Ukraine's war – but block defence spending
Councils are flying flags for Ukraine from their town halls while blocking investment in the British defence industry. At least a dozen English councils have passed motions 'divesting' from defence companies because of the war in Gaza, or taken steps to reduce their holdings in arms companies. A new report by two Labour MPs found that defence companies have missed out on at least £30 million in investment because of action taken by local councils to focus their pension funds on 'ethical' firms. It comes despite the fact that several of the councils have displayed the Ukrainian flag from their town halls in solidarity against Russia. The MPs, Luke Charters and Alex Baker, said there was 'untapped potential' in local government pensions that could be used to boost investment in the defence sector, which often struggles to access finance. They argued that supporting British defence companies would help Ukraine, which has received more than £18 billion in military and humanitarian support from the UK. The MPs said there was a 'concerning trend among UK councils to divest from defence, with at least a dozen authorities implementing partial or full exclusion policies since 2022'. The MPs did not name the councils, but The Telegraph has found evidence of town halls in London, Bristol, Somerset, Oxford and Dudley where motions have been passed banning defence investment in support of Palestine. Dudley Council, which is under no single party's overall control, passed a motion to divest from defence companies with the support of Labour and Liberal Democrat councillors. The council has flown the Ukrainian flag several times since the Russian invasion in February 2022, and lit up its town hall in blue and yellow. Labour-run Manchester City Council, which voted to pressure its pension provider to abandon weapons manufacturers in November last year, has celebrated Ukrainian independence day and spent £50,000 to support Ukrainian refugees arriving in the city. The motion noted that councillors 'recognise the inextricable link between war, climate destruction, and human suffering' and that 'armed conflicts not only result in loss of life, including civilians and children, but also lead to intense environmental destruction'. Labour-run Waltham Forest Council, which announced plans to sell all defence investments in August last year, has hosted events for Ukrainian residents affected by the 'crisis' in their home country. Mr Charters told The Telegraph: 'With war on our continent, this is not the moment for councils to pull back from investing in UK defence. 'Firms and financiers have been clear when we have engaged with them: barriers like weak demand signals, short-term contracts, divestment, and regulatory uncertainty are holding the sector back. 'Our report calls for urgent engagement with local government pension schemes — and sets out 12 reforms to help unlock the capital and credit our defence sector needs to grow. 'Financing sovereign defence isn't optional – it's vital to our security and economic future.' The report's findings also include an apparent admission from the parliamentary pension scheme for MPs that their savings are often deliberately not invested in defence. A letter to the MPs from the chair of the fund said that while there was no specific ban on defence investments, 'environmental, social, governance (ESG) and climate change issues tend to be more pronounced in some defence companies'. Mr Charters and Ms Baker said: 'There needs to be a holistic review by officials to understand how public investment vehicles are performing when it comes to defence sector investment. 'The UK cannot afford to miss this moment due to outdated ethical aversions. 'Defence investments represent not only a financial opportunity, but also an ethical obligation to secure the nation's future amidst an increasingly volatile geopolitical landscape.'
