The UK smaller companies fund will now be able to invest up to 15% of assets in non UK listed stocks, which it said will primarily be in Europe, and its 35% cap on Aim-listed securities has been scrapped.
The £354m investment trust will adopt a new benchmark as a result. It will now use the Numis Smaller Companies including Aim index, having previously used the Numis Smaller Companies excluding Aim (excluding investment companies) index.
In addition, short positions through derivatives will now be managed within one portfolio, rather than the two separately.
The resolution to change the investment policy was approved by 99.99% of shareholders at Thursday’s AGM.
The proposed changes were first announced in Throgmorton’s annual results, which were published on 12 February.
At the time, the investment trust’s board announced Dan Whitestone, Blackrock’s head of UK smaller companies, would be taking sole responsibility for the portfolio. Mike Prentis, who had worked on the fund since 2008, is now focused on the Blackrock Smaller Companies investment trust.
The Throgmorton board said the changes attempted to better reflect the “evolving nature of the listing environment for UK smaller companies”. It noted the index now included many high quality companies, which may not migrate to the main market.
It said the geographical location of a company’s listing can often reflect where the best valuations can be achieved at IPO and therefore are not necessarily where the company’s business is located or where most of its turnover is derived.
However, the board also added that European smaller companies had a “more encouraging outlook” than their UK counterparts.
Throgmorton has returned 29.8% over one year compared to 14.4% in the UK Smaller Companies sector. Over three years it has returned 74.5% compared to 52.4% in the sector.
