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A Guide to Investing in the Fundsmith Equity Fund in Singapore

Fundsmith Equity Fund is a renowned investment fund that has gained significant attention in the financial industry. Managed by Fundsmith LLP, an asset management firm founded by Terry Smith in 2010, the Fundsmith Equity Fund has established a reputation for its disciplined investment approach and impressive performance track record.

The Fundsmith Equity Fund focuses on long-term investments in high-quality companies with sustainable business models. It follows a concentrated portfolio strategy, typically investing in around 20 to 30 companies across various sectors and regions. The fund’s objective is to achieve long-term capital growth by investing in companies that have the potential to generate superior returns over time.

One of the key principles behind the Fundsmith Equity Fund’s success is its emphasis on investing in businesses with durable competitive advantages. Terry Smith and his team thoroughly analyze companies, seeking those with strong market positions, pricing power, and robust cash flows. By selecting companies with these characteristics, the fund aims to generate consistent returns even in challenging market conditions.

Another notable aspect of the Fundsmith Equity Fund is its long-term investment horizon. Terry Smith believes in holding investments for the long term, allowing companies to compound their earnings and create value over time. This patient approach aligns with the fund’s objective of capital growth and provides investors with the potential for significant returns over the years.

Fundsmith Equity Fund also stands out for its transparent and straightforward investment philosophy. Terry Smith believes in keeping things simple and avoiding complex financial instruments or speculative investments. The fund focuses on owning high-quality stocks and holding them for the long haul, minimizing unnecessary trading and transaction costs.

Furthermore, the Fundsmith Equity Fund places great importance on understanding the businesses it invests in. The fund’s team conducts in-depth research and analysis to gain a deep understanding of a company’s fundamentals, competitive advantages, and growth prospects. This rigorous approach helps in identifying companies that align with the fund’s investment philosophy and have the potential to deliver attractive returns.

The Fundsmith Equity Fund’s performance has been exceptional since its inception. It has consistently outperformed its benchmark and delivered impressive returns for its investors. The fund’s success can be attributed to its disciplined investment strategy, focus on high-quality companies, long-term perspective, and a strong emphasis on fundamental analysis.

Investing in the Fundsmith Equity Fund offers investors the opportunity to benefit from the expertise of Terry Smith and his team, who have a proven track record of selecting successful investments. The fund’s emphasis on quality, simplicity, and long-term value creation provides a compelling investment proposition for individuals seeking exposure to well-managed companies with sustainable growth potential.

Investing in the Fundsmith Equity Fund in Singapore

Investing in the Fundsmith Equity Fund in Singapore requires meeting certain criteria and utilizing specific platforms. There are different options available for both accredited investors and retail investors.

Accredited investors in Singapore have three criteria they can meet to be eligible for investing in the Fundsmith Equity Fund. Firstly, they should have an annual income of $300,000 or more in the preceding 12 months. Secondly, their net personal assets should exceed SGD2 million (or its equivalent in a foreign currency), with the net value of their primary residence contributing up to SGD1 million. Lastly, their net financial assets should exceed SGD1 million (or its equivalent in a foreign currency).

For accredited investors, investing in the Fundsmith Equity Fund can be done through the IFAST or Phillip Capital platform. They can choose to invest on their own or through a Licensed Financial Advisor who has access to these platforms. The minimum investment amount varies, ranging from SGD $5,000 or $20,000 for a single premium or as low as $100 monthly, depending on the platform.

On the other hand, retail investors do not have direct access to the Fundsmith Equity Fund through platforms like IFAST or Phillip Capital since it is a restricted foreign fund with no registration in Singapore. However, retail investors can gain exposure to the Fundsmith Equity Fund through Investment Linked Policies (ILPs) offered by certain companies. Currently, Tokio Marine, Singlife, Etiqa, FWD, and HSBC Life are among the companies that offer Fundsmith Equity Fund in their ILP platforms. The investment amount for retail investors can be as low as $200 per month or a lump sum of $1,000, depending on their budget and time horizon.

While the cost associated with ILP platforms is often assumed to be high, it is important to note that the breakeven yield may vary depending on the number of years the investments are held. Detailed information regarding specific insurers and their breakeven yields can be provided upon personal inquiry.

Investing in the Fundsmith Equity Fund in Singapore requires meeting the criteria for accredited investors or exploring ILP platforms offered by certain companies for retail investors. It is advisable to consult with a Licensed Financial Advisor or inquire directly with the relevant platforms to understand the investment options, minimum investment amounts, and associated costs.

In conclusion, the Fundsmith Equity Fund has established itself as a highly regarded investment fund, driven by its disciplined investment approach and consistent performance. With its focus on high-quality companies, long-term perspective, and transparent philosophy, the fund has attracted investors looking for a reliable and successful investment vehicle. As Terry Smith and his team continue to navigate the dynamic investment landscape, the Fundsmith Equity Fund remains a compelling choice for those seeking long-term capital growth through a disciplined and patient investment strategy.

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