This investment trust invests in consumer-focused businesses that derive most of their revenue from emerging markets.
Terry Smith, CEO and CIO of Fundsmith LLP, commented: “We have always maintained that we would only run funds where we felt we had a particular edge that would allow us to deliver superior risk-adjusted returns. Whilst FEET has made a positive return since launch in 2014 it has fallen below our expectations and, unlike other fund managers who might seek to hold onto the fund for the sake of the fee income, we feel it would be in the best interests of shareholders to receive their investment back in cash through a liquidation of the portfolio and wind-up of the Company.”
Just shows that there is no perfect investing style. Terry Smith who is termed a star manager actually ran this fund himself for 5 years and performance never picked up. He deployed the exact same investment criteria that he uses in his flagship fund but got very different results.
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I’m a big fan of Terry Smith’s style of quality investing but this shows what has worked for megacaps won’t necessarily work in emerging markets. FEET was a strange venture anyway given the fund manager’s distaste for China and so on.
I wouldn’t be too suprised to see SSON get the chop as well eventually because performance has been similarly poor. That said, I can see more of a case for it – the main fund has become so big, it can’t really invest in sub-$15-20bn companies any more.
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