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Witan beats Alliance to add emerging market star Jain

16 February 2017

Global investment trust pips rival Alliance by adding emerging markets manager Rajiv Jain to its line-up before shareholder vote.

Witan (WTAN) investment trust has added emerging markets star Rajiv Jain to its roster, pipping rival Alliance Trust (ATST) which has also proposed investing in the former Vontobel man as part of its switch to a multi-manager strategy.

The £1.7 billion global fund will allocate 4% or £70 million of its net assets to a global emerging markets portfolio run by GQG Partners, the boutique Jain set up last year after quitting Swiss firm Vontobel where he had worked for 22 years.

The investment in Jain will sit alongside the emerging markets smaller companies mandate given to Somerset Capital Management last summer after Witan dropped Trilogy Emerging Markets.

It is being funded from cash after Witan trimmed its positions in its UK and overseas managers, which include Artemis, Lindsell Train, Lansdowne Partners and Veritas.

Jain has a quality growth style and Witan chief executive Andrew Bell said he had a record of building concentrated portfolios that could outperform markets over the long term.

‘We have had investments in emerging market funds for a number of years and from 2017 emerging markets also form 5% of the benchmark that we use to measure our performance.

‘Emerging markets are not a homogeneous asset class as countries and companies within the universe often possess quite different investment characteristics. Therefore, a key aspect of our search was to identify a manager to construct a portfolio of high quality companies which was truly benchmark agnostic, selecting the best companies in this varied and exciting area,’ he added.

Witan’s emerging markets exposure is largely in Asia Pacific where it had a 10% weighing at the end of January, much of it run by Matthews Asia, according to a company fact sheet. It has 41% in the UK, 25% in North America and 16% in Europe.

Witan has generated a 98% return from its portfolio of managers over the past five years, although the total return to shareholders has been higher at 117%. The shares trade at a discount of 5% below NAV.

Alliance Trust shareholders will vote this month on a board proposal to sack their fund manager and appoint Willis Towers Watson to run a multi-manager portfolio including GQG Partners.

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