Liontrust Assessment of Value Report - Flipbook - Page 64
Liontrust UK Mid Cap Fund
The manager of the Fund changed from Mark Martin to the Economic
Advantage team on 19 August 2020. Liontrust merged the Fund
with the Liontrust UK Growth Fund on 2 December 2020 following
regulatory and shareholder approval.
Performance
We have assessed the investment performance of the Fund against both its stated investment
objective, as well as against the benchmarks that are set out in its prospectus. We considered
whether the Fund has performed how we and investors would expect it to, given the market
conditions it has been operating under and its investment philosophy, strategy and process.
The Fund has produced a negative capital return, and significantly underperformed both the
benchmark and sector over the last five years. We have concluded that the Fund has not met
investors’ expectations.
Quality of service
Our assessment has considered the range and quality of services experienced by investors.
We have concluded that the quality of services provided by Liontrust is better than or in
line with expectations across all the UK-domiciled funds. This has been evaluated through a
detailed review of the services we provide, our engagement with investors, communications
and governance, and confirmed through our investor survey.
General costs of authorised fund manager
We have reviewed the breakdown of the charges of the Fund’s Ongoing Charges Figure (OCF)
and our explicit transaction costs. Our assessment has concluded that the Fund’s charges are
reasonable, and the costs of services provided to the Fund are being appropriately managed.
Research costs have been absorbed by Liontrust and are not charged to the Fund.
Comparable market rates
We have assessed the charges of this Fund against comparable funds in the market. The OCF
of the highest charging share class of this Fund is higher than those of many comparable funds
and we have therefore undertaken a detailed review.
Economies of scale
Our assessment has considered whether we are able to generate efficiencies to achieve
economies of scale and if such cost savings have been passed onto our investors. The
Fund benefits from a fixed Administration Fee model, which, as well as providing clarity
in relation to fund costs to investors, allows cost savings achieved from an increase in the
Fund’s size to be directly passed to investors through the application of a discount. As the
Fund grows in assets above £500 million, the fixed Administration Fees are reduced by up
to a maximum of 0.06% above £5 billion in assets. Overall, with the growth in Liontrust’s
assets under management over the past few years, our investors have been able to benefit
from the savings created.
Comparable services
There are no Comparable Services provided for this Fund.
Classes of shares or units
Our assessment has considered whether investors are invested in the most appropriate share or
unit class that is available to them. Based on the information available to us, our review concluded
that it is appropriate for investors in this Fund to be invested in the share class they are currently
invested in.
64 - Liontrust Assessment of Value Report
Overall value
assessment
We have evaluated the fund
against all seven criteria in
our assessment of the value
it provides to investors. The
conclusion is that the Fund
has not been delivering value
consistently for investors given
the Red for the performance
criteria and Amber for
comparable market rates.
We changed the manager
of the Fund in August 2020
and merged the Fund with
the Liontrust UK Growth Fund
on 2 December 2020.