Edentree is set to become the latest investment firm to close charity-specific pooled funds, the 2023 Charity Finance Pooled Funds Survey has revealed.
The annual survey found that while no pooled funds aimed solely at the charity market launched in the past year, six charity-specific pooled funds closed or will close in the next few months.
Too small
Edentree is closing its Amity Balanced Fund for Charities and the Amity Global Equity Fund for Charities, following a review of its product range, which found these funds to be too small to offer the scale that the firm believes its charity clients need.
Ian Dale, charity and institutional client relationship manager at Edentree, told Charity Finance: “To provide a stronger platform from which to deliver both the performance and the service charities expect, we intend to close the funds at the end of September.
“We will offer clients a free switch into a new share class of the EdenTree Responsible & Sustainable Managed Income Fund, which has a discounted annual management charge (AMC) of 0.55%, or alternatively a move into one of the other screened funds in our responsible and sustainable range.”
Edentree is not alone in citing the size of a fund as the reason for its closure.
Cazenove closed its Charity Bond Fund in May and told the survey this was because it was small and had not grown for some time.
Co-head of charities at Cazenove Tom Montagu-Pollock said: “We carefully considered various options to try and restructure with a view to growth but decided to close it.
“This illustrates that charities have increasingly moved to a pooled multi-asset approach, rather than using single asset class funds, in the past decade.”
Other closures
Another fund that closed in the past 12 months is the CAF UK Equitrack Fund, which closed on 27 April 2023.
Funds were returned to investors as CAF Financial Solutions Limited (CFSL) decided to focus on the three IFSL funds managed by abrdn.
It said these offer a “compelling solution to the increasing number of charity investors that are asking for multi-asset funds with environmental, social and governance filters”.
Finally, Epworth closed its Corporate Bond Fund for Charities and Sterling Sovereign Bond Fund for Charities at the end of April 2023.
The 2023 Charity Finance Pooled Funds Survey is published in the July issue of Charity Finance magazine.
It covers 49 funds that are exclusively for charitable organisations, with combined funds under management of £23.1bn.
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