Objective

The Company’s objective is to invest internationally to achieve capital growth, which takes priority over income and dividends.
 

Investment Policy

Monks seeks to meet its objective of achieving capital growth through investment principally in a portfolio of international quoted equities. Equities are selected for their inclusion within the portfolio solely on the basis of the strength of the investment case.

When investing, the Company is prepared to move freely between different markets as opportunities arise. There are no limits to geographical or sector exposures, but these are reported to, and monitored by, the Board in order to ensure that adequate diversification is achieved. The equity portfolio is relatively concentrated for a global fund and, as at the financial year end, it contained 121 equity holdings including 18 investments in funds. The number of holdings in equities and funds will typically be between 70 and 200.

Investment may also be made in funds (open and closed-ended) including those managed by Baillie Gifford & Co. The maximum permitted investment in UK listed investment companies in aggregate is 15% of gross assets. Asset classes other than equities will be purchased from time to time including fixed interest holdings, unquoted securities and derivatives. The Company may use derivatives for the purpose of efficient portfolio management (including reducing, transferring or eliminating investment risk in its investments and protection against currency risk) and to achieve capital growth.

While there is a comparative index for the purpose of measuring performance, no attention is paid to the composition of this index when constructing the portfolio and the composition of the portfolio is likely to vary substantially from that of the index. A long term view is taken and there may be periods when the net asset value per share declines both in absolute terms and relative to the comparative index. Payment of dividends is secondary to achieving capital growth. The shares are not considered to be a suitable investment for those seeking a regular or rising income.

Borrowings are invested in equity and other markets when this is considered to be appropriate on investment grounds. Gearing levels, and the extent of equity gearing, are discussed by the Board and Managers at every Board meeting and adjusted accordingly with regard to the outlook. New borrowings will not be taken out if this takes the level of effective equity gearing to over 30% of shareholders’ funds. Equity exposure will, on occasions, be below 100% of shareholders’ funds.