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Allan Gray’s Equity Fund changed

Effective March 1, 2015.

JOHANNESBURG – Allan Gray has received overwhelming support for changes to its Equity Fund.

In December the fund manager proposed several changes to the fund in an effort to “increase long-term returns and reduce risk through wider investment opportunities and lower fees”. (Read Moneyweb’s previous article about the proposal here.)

The detailed changes, which include some offshore equity exposure, a new benchmark and amendments to the fee structure, are displayed in the table below. It took effect on March 1.

Inge

Source: Allan Gray 

The proposal was a package deal and investors were only allowed to vote in favour of or against all the changes collectively.

In a letter sent to clients, Jeanette Marais, director for distribution and client service, said “investors representing 48.3% of the Fund’s value responded to the ballot, of which 99.4% voted in favour of the changes”. 

Allan Gray required completed ballot forms for at least 25% of the Fund’s units and a majority vote (51%) in favour of the changes for it to be implemented.

The Financial Services Board (FSB) informed the fund manager on February 27 that the ballot was approved.

In December the Equity Fund had more than a 100 000 underlying investors. At the end of January the fund had R41.6 billion in assets under management.

SA equity

Investors who would still prefer to access a South Africa-only equity fund, would be able to invest in the Allan Gray SA Equity Fund from March 16, Marais said.

“Although the new SA Fund will not be marketed publically, you will be able to access it at any time upon request,” Marais said.

The new SA Fund will have the same fee structure as the Allan Gray Equity Fund (see new fee section above) and its benchmark will be the FTSE/JSE All Share Index (including income), Marais said.

Since the SA Fund will be completely separate to the Equity Fund, switching between the funds could result in a capital gains tax liability.

* The journalist is an investor in Allan Gray’s Equity Fund.

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