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UK Property Funds Since Brexit

Jamie_BarnesJamie_Barnes Member
in Products & providers
I thought i'd start a new topic to ask what everyone is currently doing since the vote to leave with clients in UK property funds. The announcement made by SLI to suspend their fund might only be the start, Henderson has seen it's fund size decrease from 4.1BN to about 1.6BN so might not be far behind; M&G took the steps before the referendum to change the pricing over to cancellation basis.

Did anyone reduce their exposure before the referendum? Is anyone making changes now? Or is it the old adage, 'time in the market not timing the market'?

We're currently in a wait and see mode but are definitely concerned about the money flowing out of the funds and potential suspensions.
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  • amarshallamarshall Member, Moderator
    We have a meeting about this tomorrow. Will contribute more afterwards.
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  • RalfosRalfos Member
    We began trimming property from an admittedly overweight position 3 months ago (so not based on Referendum) but as is life, not all clients have had their reviews yet. So basically all of our clients have somewhere between 5-10% in the SL fund. Fun times ahead..........
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  • richallumrichallum Administrator
    Not much we can do with people in the funds now but as a short term tactical measure we're putting the % allocated to property in CIPs into cash with a rolling 28 day review.

    Paraplanner. F1, Apple, Nutella, ice cream. No trite motivational quotes. Turning a bit northern. 

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  • Jamie_BarnesJamie_Barnes Member
    We've decided on something similar Richard after some deliberation; we're also considering infrastructure and convertible bonds but it looks like those funds have already been snapped up and are now expensive. We're also considering REITs but not at all comfortable with this at the moment.

    Just a side note, some further digging shows there are a few absolute return funds trapped in amongst this so it might warrant additional due diligence and research at a time like this if firms decide to go down that route for alternatives.
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  • RalfosRalfos Member
    Can anyone explain to me how the dilution levy would work on buying a fund? (Aberdeen).

    Eg today the levy is 7% and I buy £1 of stock.

    If the levy is removed next week, does (all other things being equal) the unit price increase to £1.07? 

    It seems fairly simple when selling a fund but buying is confusing me....
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