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NEWTON UK EQUITY

NEWTON UK EQUITY - Overview

Overview of NEWTON UK EQUITY Buy in ISA Buy in Investment Account

The aim is to achieve capital growth and income from a portfolio of predominantly UK equities, investing principally in larger companies, though small and mid-sized stocks may also be included. The yield on this fund is enhanced by deducting charges from capital. Newton follow a global thematic approach, which sets the framework for which sectors to invest in. This Fund may also invest up to 20% in overseas stocks.

  • Standard Initial Charge 0.00%
  • Initial charge via Bestinvest 0.00%

Fund summary

Sector UK All Companies
Structure OEIC
Launched May, 1985
Size £1,000m
Yield 2.7%
Charging basis Capital
Dividends paid 28 Feb, 31 May, 31 Aug, 30 Nov

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 1.50%
Ongoing charges figure 1.61%

Risks

Before investing make sure you have understood the risks relevant to the fund by reviewing our Risk Warnings section. Further information on the risks are contained in the fund's Key Investor Information Document, which we make available to you before you make a decision to invest, alternatively it is available on request.

Bestinvest view

In recent years the fund has suffered from Newton's global house themes, which generally have been out of favour with prevailing markets, as well as inconsistency of fund manager tenure. Its most recent fund manager Richard Wilmot took control of the fund in March 2011. The fund is not rated by Bestinvest at present and investors looking for another income-biased UK equity growth style fund could consider JO Hambro CM UK Opportunities rated 5 stars or Old Mutual UK Alpha rated 4 stars.

Portfolio

Allocation Proportion(%)
Equity 99
High yield bonds 0
Quality bonds 0
Property 0
Commodities 0
Hedge 0
Fund cash 1
Allocation Proportion(%)
UK 82
Europe 3
North America 11
Japan 0
Pacific 0
Emerging Markets 4
Allocation Proportion(%)
Large Caps 51
Mid Caps 35
Small Caps 14
View all performance data for this fund

Investment process

The fund generally invests in companies with a market cap above £1bn due to stock liquidity and availability, though small and mid-cap stocks may be included. Stock selection generally reflects Newton’s in-house thematic views and the portfolio is chosen from the recommendations of Newton's global sector analysts. As a result the portfolio may include overseas stocks where these stand out compared to their UK counterparts. However, whilst the manager is guided by the house view, he is allowed enough freedom to stamp his authority on the fund. Typically the manager would prefer growth stocks, i.e. stocks growing their earnings at an above average rate as well as their dividends. However, the fund manager can be quite flexible and not follow either a value or growth investment style exclusively; instead concentrating on investing in attractively valued stocks with good prospects and strong fundamentals. Companies with sound balance sheets are generally sought as well as companies with a good ability to generate above average returns from their invested capital base. Every stock has a predefined price target which is constantly reviewed through the regional, global and research meetings.

Live feed

Bid price(inc) 763.62p 43.87p
Accum units 763.62p
Fund commentary 12/05/14
Fund data updated on 26/08/15

Asset allocation

Allocation Proportion(%)
Equity 99
High yield bonds 0
Quality bonds 0
Property 0
Commodities 0
Hedge 0
Fund cash 1

Equity Geographic

Allocation Proportion(%)
UK 82
Europe 3
North America 11
Japan 0
Pacific 0
Emerging Markets 4

Equity Capitalisation

Allocation Propor
tion(%)
Large Caps 51
Mid Caps 35
Small Caps 14

Top 10 holdings

As at: 30/06/2015
5.27% Diageo
4.36% British American Tobacco
3.87% Astrazeneca Plc
3.63% Relx Plc
3.63% Capita Plc
3.61% Vodafone Group
3.28% Playtech Plc
3.19% Reckitt Benckiser Group Plc
3.08% Imperial Tobacco Group
2.52% Standard Life Plc
Source: Trustnet

Sector breakdown

Consumer Services 27%
Consumer Goods 17%
Financials 15%
Industrials 11%
Health Care 9%
Utilities 7%
Telecommunications 4%
Technology 4%
Oil & Gas 2%
Money Market 2%

Portfolio details

The fund holds around 30-60 stocks.

Constraints

Maximum 20% in overseas stocks. Long-term tracking error 2% to 6%. Maximum 5% in cash.
The portfolio usually has very little commonality with the benchmark and so performance can be expected to differ markedly on occasions.

Average monthly relative returns Bestinvest MRI
10/11 11/12 12/13 13/14 14/15   3 years 5 years Career 3 years 5 years Career
0.14% 0.93%   0.49% 98.10%
Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Paul Stephany

Manager. Stephany joined Newton in 2005 from PWC where he was a corporate tax consultant. He joined the UK equity team as a trainee fund manager and took over leadership of the UK Smaller Companies fund in 2011. He is a CFA charterholder, a Member of the Institute of Chartered Accountants in England and Wales and has a BA (Hons) in Modern History from Oxford University.

Track record

Paul Stephany has 2.5 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.49%. During the worst period of relative performance (from March 2014 - July 2014) there was a decline of 3% relative to the index. The worst absolute loss has been 5%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 98%.

Periods of worst performance
Absolute -5% (May 2013 - June 2013)
Relative -3% (March 2014 - July 2014)

Other funds managed

  Start Date
NEWTON UK EQUITYSep 2014
NEWTON UK OPPORTUNITIESFeb 2013

Sector record since February 2013 (2 yrs)




About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

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