Star manager Terry Smith will continue to oversee progress at Fundsmith Emerging Equities Trust


Loss to date: 3.25%

Original entry point: Buy at £12.30, 14 March 2019

Our March ‘buy’ call on Fundsmith Emerging Equities Trust (FEET) is 3.25% in the red, sentiment souring slightly on the news (22 May) star manager Terry Smith is stepping back from the day-to-day running of the trust.

The reassuring news is Smith - in his role as Fundsmith’s chief investment officer (CIO) - will continue to lend advice and support to Michael O’Brien and Sandip Patodia, appointed to the roles of Portfolio Manager and Assistant Portfolio Manager respectively.

We don’t expect any significant change in the investment approach of the trust, which is cutting its annual fee by 0.25% to 1% of NAV, despite Smith stepping back from his role as lead manager. O’Brien and Patodia have both been involved in the management of the trust since its 2014 inception and are fully versed with the current holdings.

FEET puts money to work with established, well-managed companies with cash generative brands of consumer staple products able to deliver compound growth over the long term.

SHARES SAYS: We believe it is business as usual for FEET with Terry Smith continuing to provide oversight as CIO. We also note he note bought shares on the day of the announcement in a show of confidence in the promoted pair.

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