In a letter to shareholders last month, Invesco said the change was made as a result of the growth in the fund’s assets under management. The result of this change is twofold the firm said: the first is that it solves the problem of scalability it was beginning to face in some of its fund holdings and it also allows for a change in mandate limiting the amount invested in funds that could bring in new investors.
Under UCITS regulations an investor may not own more than 25% of the shares in issue of a collective investment scheme. According to Invesco, the fund was approaching that threshold in some of its fund holdings.
Having made the move into direct investments, Invesco said: “The fund is more scaleable; and by investing directly in the underlying assets of Invesco and Invesco Perpetual funds the 25% limit referred to the above will no longer be a potential issue.”
According to the firm, all costs associated with converting the fund investments into direct investments have been borne by the Invesco and will have no impact on the fund’s NAV.
Invesco also plans to alter the mandate of the fund. Effective from 19 October 2015, the fund will no longer be able to invest up to 100% of its value in other funds, instead it will only be able to invest up to 10% in other funds.
This will mean Invesco said: “other collective investment schemes previously prohibited from investing in the fund due to fact that more than 10% of the fund’s NAV was invested in funds will be able to invest in the fund.
The fund currently has £2.9bn in AUM.
