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M&G Global Listed Infrastructure Fund - Overview

04/01/2019

The M&G Global Listed Infrastructure Fund has a total return (the combination of income and growth of capital) objective and aims to outperform the the MSCI ACWI Index, net of the Ongoing Charges Figure, over any five-year period. It also aims to provide a rising income stream in sterling by investing in infrastructure stocks which tend to exhibit characteristics of higher yield and lower volatility compared to global equities.

What is the Fund trying to achieve?

  • The fund is managed by Alex Araujo in M&G’s income team which embraces dividend growth as the foundation of its philosophy. The team manages £9 billion in global and regional strategies.
  • The fund invests in companies which own or control critical physical infrastructure – essential assets for the functioning of global society. The fund provides retail investors with access to assets generating attractive cashflows – cashflows which are not only stable but have the potential to grow over the long term.
  • An infrastructure fund with ESG integrated in the process, but not an ESG or impact fund – this is an important distinction. Coal-fired power and nuclear power are considered as hard exclusions for economic reasons.
  • A fund with geographic diversity, including emerging markets, and limited overlap with the M&G Global Dividend Fund.
  • A fund designed to cope with the potential shocks of rising interest rate expectations and higher inflation.*

How is the Fund differentiated?

  • The fund provides access to a broader universe of infrastructure companies to better reflect the modern age and the increasingly digital world we live in. The fund invests beyond the traditional realm of utilities, energy and transport and diversifies into the social sphere (health, education and security) as well as the structural growth opportunities available in the evolving areas of infrastructure (communication, transactional and royalty).
  • Listed infrastructure indices are heavily skewed towards utilities and therefore provide limited diversification. This bias results in the performance of listed infrastructure indices mimicking the returns of bond proxies, which will not perform in all market conditions. There are no viable passive alternatives to M&G’s diversified approach.
  • M&G Global Listed Infrastructure Fund benefits from the broader infrastructure expertise across M&G, including M&G Infracapital (private equity) and M&G’s infrastructure debt team.

How is the Fund different to the M&G Global Dividend Fund?

  • The M&G Global Listed Infrastructure Fund will typically offer a higher starting yield, while the M&G Global Dividend Fund is expected to grow distributions more quickly over the long term.
  • M&G Global Listed Infrastructure Fund is expected to show lower volatility than M&G Global Dividend Fund and the MSCI ACWI Index as a function of the types of stocks it invests in.
  • M&G Global Listed Infrastructure Fund has a specific focus on ESG given the nature of infrastructure assets which require closer examination of business sustainability and risk.

*Inflation measured by the OECD G7 CPI.

The value of investments and the income from them will rise and fall. This will cause the fund price, as well as any income paid by the fund, to fall as well as rise. There is no guarantee the fund will achieve its objective, and you may not get back the amount you originally invested.

The funds invest mainly in company shares and are therefore likely to experience larger price fluctuations than funds that invest in bonds and/or cash.

For financial advisers only. Not for onward distribution. No other persons should rely on any information contained within. This financial promotion is issued by M&G Securities Limited which is authorised and regulated by the Financial Conduct Authority in the UK and provides ISAs and other investment products. The company’s registered office is Laurence Pountney Hill, London EC4R 0HH. Registered in England No. 90776.

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The value of the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise and you may get back less than you originally invested.
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