Legal & General Investment Management (LGIM) has unveiled a global thematic strategy, which will provide diversified access to multiple long-term themes.
The Legal & General Global Thematic Fund will be managed by Dave Barron, head of index equity and smart beta at LGIM, and is benchmarked against the MSCI World Total Return Net Index.
The fund which is structured as an onshore unit trust, has been designed specifically for UK investors following an increasing demand for access to multiple themes. It will look to leverage LGIM’s scale, index and ETF expertise while seeking to minimise transaction costs, savings which can be passed back to investors.
LGIM has brought together eight investment themes into the product, in the areas of technology, energy and resources and changing demographics, all of which are currently available to investors via a suite of L&G building-block ETFs. The themes included are artificial intelligence, robotics and automation, cyber security, battery value-chain, clean water, eCommerce logic, healthcare breakthroughs, and pharma breakthroughs.
By combining the investment universes of its existing individual thematic strategies, LGIM has created a strategy for investors seeking exposure to a portfolio of companies it believes are positioned to benefit from these long-term themes.
With an underlying investment universe of just over 400 stocks the fund uses a quantitative allocation model to provide exposure to growth themes while aiming to maximise diversification. The model aims to improve overall portfolio volatility and return characteristics as each theme evolves over time, weighting the underlying thematic strategies so that they contribute approximately the same level of risk to the fund. The underlying thematic strategies invest in unique stocks LGIM believes are typically captured by traditional market cap weighted benchmarks. LGIM expects this will allow investors to complement their existing investments with exposure to a wider range of growth-oriented companies.
Commenting on the fund’s launch, Aanand Venkatramanan, head of ETF investment strategies at LGIM, said: “The Global Thematic Fund complements the success of LGIM’s ETF and thematic businesses, offering clients simple access to diversified themes, which traditionally have been difficult to capture in a single product. We are proud of the strong track record of the existing strategies within our thematic universes and are pleased to bring the investment philosophy to a wider investor audience.”