Fact sheet: Mercantile IT

Rated Fund Information
Rated Funds Group
?Money Observer has arranged all its Rated Funds into easy to understand Rated Fund Groups, comprising funds and investment trusts.
UK GROWTH
Sector
IT UK All Companies
Fund type
Investment Trust
Primary aim
GROWTH
Why Money Observer Rates Mercantile IT

Rated Fund 2014, 2016-2017. The largest UK-focused investment trust

Mercantile belongs to the JPMorgan investment trust stable. Launched in 1884, it is one of the UK's oldest trusts. With assets of nearly £2 billon, it is also the largest UK-focused investment trust.

Its primary objective is to achieve capital growth through investing in UK medium-sized and smaller companies, however the trust also aims to increase its dividend at least in line with inflation over the long term.

In 2016, Guy Anderson took over as lead manager of the trust although Martin Hudson, who was the lead manager for over 20 years, remains on the team along with fellow co-manager Anthony Lynch.

Each manager specialises in particular sectors and takes responsibility for investment decisions within these sectors. They are not style-driven and bottom-up stock selection drives portfolio construction.

Their investments tend to fall into three categories: companies with sustainable competitive advantages operating in attractive end markets; companies experiencing positive change such as restructuring; and companies with attractively valued assets overlooked by the market.

They say the feature that companies in all three categories have in common is that they will be run by strong management teams that are focused on shareholder returns.

The portfolio is well diversified, with over 100 holdings, and may include a few FTSE 100 companies that have been promoted to that index since the trust bought them. However, generally if companies move into the FTSE 100 they are sold and the money is reinvested further down the size scale.

3 Year Performance
Fund Performance47.4%
Average of Rated Funds Group50.5%
Sector Performance27.6%
Fund information
Fund name
The Mercantile Investment Trust Plc
Fund manager company
JP Morgan Asset Management UK
Fund type
Investment Trust
Fund managers
  • Anthony Lynchsince 06/09/2009
  • Martin Hudsonsince 01/01/1994
  • Guy Andersonsince 06/08/2012
Accolades
Fund objective
The Trust aims to achieve capital growth through investing in a diversified portfolio of UK medium and smaller companies. It pays quarterly dividends and aims to grow its dividend at least in line with inflation. The Company can hold up to 10% cash or utilise gearing of up to 20% of net assets where appropriate.
Benchmark
  • FTSE AllShare (ex FTSE 100, ex Inv Companies)
Investment style
Growth
Investment method
No data available.
Quick stats
1 Year return
22.2%
1 Year rank in sector
6/15
Sector
IT UK All Companies
Yield
2.3%
Ongoing charge (OCF)
?A fund’s ongoing charges figure (OCF) is similar to the old-style total expense ratio. It reflects the annual charge to investors in the fund, in percentage terms, but does not include extra performance-related fees (where these are levied) or the fund’s trading expenses on its underlying investments.
0.51%
Fund size
£1,656m
FE Risk score
?FE Risk Scores measure the riskiness of instruments relative to the FTSE 100 index of shares. Weekly volatility is measured over three years with recent behaviour counting more heavily than earlier behaviour. Cash-type investments will have scores close to zero. Funds will tend to have scores in the 0-150 range. The FTSE 100 is always scored at 100. There is no upper limit.
93
Mid price
1993
NAV
?Net asset value. The NAV per share may be higher or lower than the share price, which in turn is trading at either a discount or a premium to NAV.
2228.3
Discount/Premium
?When the market price of an investment trust’s shares is less than the net asset value (NAV) per share then it is trading at a discount to NAV. A trust’s shares are on a premium when they trade at a higher price than the NAV.
-10.56
Gearing
?Investment trusts have the ability to borrow money which they invest with the aim of generating a higher return than the cost of the loan. An ungeared trust has a figure of 100. A figure of 110 would represent a trust with 10% gearing.
104
Top in this sector
Fund name1 Year
Fidelity Special Values PLC28.4%
Manchester & London IT plc28.2%
Artemis Alpha Tst plc28.1%
Aurora Investment Trust plc26.7%
Henderson Opps Tst22.3%
...more in IT UK All Companies

Performance snapshot

Holdings snapshot

  • UK93.2%
    Money Market6.8%
  • Industrials29.2%
    Consumer Services23.9%
    Financials21%
    Consumer Goods8.2%
    Money Market6.8%
  • UK Equities93.2%
    Money Market6.8%

Performance vs Sector

Cumulative performance
 1 mth3 mth6 mth1 yr3 yr5 yr
Fund2.8%3.5%11.7%22.2%47.4%127.3%
Sector2.1%-0%6.8%17.8%27.6%85.3%
Rank within sector9 / 153 / 152 / 156 / 154 / 145 / 13
Quartile3rd1st1st2nd2nd2nd
Calendar performance
 YTD - 20172016201520142013
Fund17.9%-3.7%30%-4.2%44.9%
Sector12.9%3.8%9.1%-1.7%31.3%
Rank within sector5 / 1510 / 152 / 148 / 135 / 13
Quartile2nd3rd1st3rd2nd
Risk statistics
Alpha
?Alpha is a measure of a fund's over- or under-performance by comparison to its benchmark. If the Alpha is 5, the fund has outperformed its benchmark by 5%; so the greater the Alpha, the greater the outperformance.
2.89
Beta
?Beta estimates a fund's volatility by comparison to that of its benchmark. A fund with a beta close to 1 means that the fund will move generally in line with the benchmark. Higher than 1 and the fund is more volatile than the benchmark and vice versa.
1.42
Sharpe
?This commonly-used measure calculates the level of return over and above the return of a notional risk-free investment, such as cash. The difference in returns is then divided by the fund's volatility. The resulting ratio is an indication of the amount of excess return generated per unit of risk.
0.68
Volatility
?Volatility (or standard deviation), when applied to an investment fund, expresses its risk. It shows how widely a range of returns varied from the fund's average return over a particular period. For example, if a fund had an average return of 5%, and its volatility was 15, this would mean that the range of its returns over the period had swung between +20% and -10%.
15.33
Tracking error
?This measures the standard deviation of a fund's excess returns over the returns of an index or benchmark portfolio. As such, it can be an indication of 'riskiness' in the manager's investment style. A Tracking Error below 2 suggests a passive approach. At 3 and above the the manager will be deploying a more active investment style.
8.61
Information ratio
?This is a useful risk-adjusted measure of actively managed fund performance. It is calculated by deducting the returns of the fund's benchmark from the fund's overall returns, then dividing the result by its tracking error. The higher the Information Ratio the better. It is generally considered that a figure of 0.5 reflects a good performance, 0.75 very good, and 1.00 outstanding.
0.65
R-Squared
?An indication of how closely correlated a fund is to an index or a benchmark. Values for R-Squared range between 0 and 1, with 0 indicating no correlation at all and 1 showing a perfect match. Values upwards of 0.7 suggest that the fund's behaviour is increasingly linked to its benchmark.
0.76
Price movement
52 week high2012
52 week low1624
Current bid price1993
Current offer price1995
Current mid price1993
Region
1UK93.2%
2Money Market6.8%
Industry sector
1Industrials29.2%
2Consumer Services23.9%
3Financials21%
4Consumer Goods8.2%
5Money Market6.8%
6Technology4.1%
7Basic Materials2.4%
8Health Care2.3%
9Oil & Gas1.3%
Asset type
1UK Equities93.2%
2Money Market6.8%
Individual holdings
1SMITH(DS)2.7%
2SPIRAX-SARCO ENGINEERING2.1%
3BELLWAY2%
4JUST EAT PLC2%
5INCHCAPE PLC1.9%
6AUTO TRADER GROUP PLC1.8%
7HALMA1.8%
8INTERMEDIATE CAPITAL GROUP1.8%
9MELROSE SA1.8%
Management
Fund manager group
J.P. Morgan Asset Management
Fund manager company
JP Morgan Asset Management UK
Fund type
Investment Trust
Fund objective
The Trust aims to achieve capital growth through investing in a diversified portfolio of UK medium and smaller companies. It pays quarterly dividends and aims to grow its dividend at least in line with inflation. The Company can hold up to 10% cash or utilise gearing of up to 20% of net assets where appropriate.
Benchmark
  • FTSE AllShare (ex FTSE 100, ex Inv Companies)
Investment style
Growth
Investment method
No data available.
Fund managers
NameSinceBiography
Anthony Lynch06/09/2009Anthony Lynch is a portfolio manager within the J.P. Morgan Asset Management European Equity Group and co-manages The Mercantile Investment Trust, specialising in smaller and mid-sized UK equities. Anthony joined in 2009, initially as an analyst, and now co-manages the Investment Trust. Prior to this he obtained a B.A. (Hons) in Economics from Durham University. He is a CFA charterholder.
Martin Hudson01/01/1994Martin Hudson is a portfolio manager within the J.P. Morgan Asset Management European Equity Group, responsible for The Mercantile Investment Trust and specialising in smaller and mid-sized UK equities. An employee since 1982, he was previously an investment manager in the UK Portfolios Group, managing both the UK equity portfolio of the Fleming Fledgeling Investment Trust (now the JPMorgan US Smaller Companies Investment Trust) and segregated pension fund portfolios. Before this he was manager of the UK Investment Research Department and previously was a building and property analyst. Prior to joining the firm, he worked on manufacturing and acquisitions for Blue Circle Industries. Martin obtained an M.A. in Natural Sciences from the University of Cambridge and is a chartered Engineer.
Guy Anderson06/08/2012Guy Anderson is a portfolio manager within the J.P. Morgan Asset Management European Equity Group and co-manages The Mercantile Investment Trust. An employee since 2012, Guy was previously a senior analyst at Breeden European Capital Management and before that an investment analyst at Pendragon Capital. Prior to this, Guy worked as a project manager in the Corporate and Investment Banking division at Oliver Wyman. He obtained an M.Eng (Hons) in Engineering from Oxford University, and is a CFA charterholder.
Compliance
AIC Member
Domicile
No data available.
Fund for sale in
United Kingdom
The Mercantile Investment Trust Plc
Initial charge-
Annual charge-
Min single investment£0
Min regular saving£0
Available in ISANo
Ongoing charge (OCF)-
Total expense ratio (TER)-
Bid price-
Offer price-
Mid price2324.5
CurrencyGBX
Price updated16/08/2017
TypeAccumulation
Institutional or retail classRetail
Domicile-
Citi codeNJHZ
Data provided by

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