The investment objective of the Fund is to grow the value of investor's investment (known as “capital growth”) in excess of the Numis Smaller Companies + AIM Excluding Investment Companies Index Net Total Return (the “Benchmark”) over a rolling 5 year period, after the deduction of all fees. The Fund seeks to achieve its investment objective by investing at least 80% of its value in shares of the smallest 10% of companies in the UK stock market in terms of market capitalisation (total number of shares outstanding multiplied by the current price). Investment can be direct, or indirect, in shares (including common and preference shares), rights for shares, warrants, depositary receipts (securities issued by banks that represent company shares), investment trusts (including REITS) and collective investment schemes.
The Fund invests at least 80% of its assets in shares (also known as equities) of smaller companies, in any industry, in the UK. Companies will be incorporated, headquartered, or deriving significant revenue from, the UK. The Fund may also invest in other assets including cash and other shares.
The Fund invests at least 80% of the portfolio in shares of small sized companies across the world. These are companies which, at the time of purchase, have a market capitalisation of under £10 billion. You are able to redeem your investment from the Fund at any time and there is no exit fee for doing so.
Small-cap funds are those that invest exclusively in “small caps,” or companies with a relatively small market capitalization, which is the total value of the company's outstanding shares. In contrast, large-cap funds invest only in “large caps,” or the biggest publicly traded companies.
UK government bonds, also known as “gilts,” are loans that investors make to the government. Due to being underwritten by the government, they are considered the safest forms of investment. When you invest your money in this asset class, the government pays you a fixed rate of interest until the bond matures.
Technically, mutual funds are actually a US concept. In the UK, the equivalent type of fund is called an 'open-ended investment company' or OEIC. But almost everyone calls them mutual funds anyway, so that's the term we'll use. (To be very thorough, there are also similar funds in the UK called unit trusts.
Any company with a Market Capitalisation of less than GBP 50 million is classified as a Micro Cap, less than GBP 350 million is a Small Cap, less than GBP 2.5 billion is a Mid Cap and all larger companies are Large Cap.
The UK government definition of SMEs encompasses micro (less than 10 employees and an annual turnover under €2 million), small (less than 50 employees and an annual turnover under €10 million) and medium-sized (less than 250 employees and an annual turnover under €50 million) businesses.
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