Question
Thank you for a very useful website.
I've recently reduced my holdings in China funds, but expect to restore them in due course. One of the funds I might then consider is "Insynergy Absolute China". The iii website categorises this as "Offshore UK Authorised".
Are there are any pros and cons I should be aware of before I put any ISA money into such a category of fund?Answer
The Insynergy Absolute China fund is an open ended investment company (oeic) domiciled in Dublin. From a UK investor tax point of view the fund will be treated in the same way as one domiciled in the UK. The fund (according to its prospectus) intends to be a ‘reporting fund’ for UK tax purposes, which means that gains will be subject to capital gains tax and income, although not distributed, must be declared with any income tax owed being paid.
However, whether you’ll benefit from any investor protection seems the subject of some confusion. The fund’s prospectus suggests that it’s not covered by the Financial Services Compensation Scheme. And on calling both Insynergy and State Street (the custodian/administrator) neither could tell me whether the fund was covered by an equivalent Irish compensation scheme. Insynergy’s press office is now helping to find out and I’ll update this page when I get a definite answer.
As for the fund itself I haven’t looked into it in any detail but the manager, Michael Lai, has performed well running the GAM Star China Equity fund that he’s managed since July 2007. Just beware that the fund has a fairly hefty uncapped performance fee of 20% of returns above 3 month LIBOR (i.e. cash) – this means that at the time of writing you should expect to pay a fifth of any annual returns above 0.66% in fees as well as the standard annual charge of 1.25%.
Insynergy Investment Management was set up by Spike Hughes, a former Hargreaves Lansdown director and boasts ‘dragon’ entrepreneur James Caan as its chairman - not sure whether this is a good or bad thing!
Thank you for a very useful website.
I've recently reduced my holdings in China funds, but expect to restore them in due course. One of the funds I might then consider is "Insynergy Absolute China". The iii website categorises this as "Offshore UK Authorised".
Are there are any pros and cons I should be aware of before I put any ISA money into such a category of fund?Answer
The Insynergy Absolute China fund is an open ended investment company (oeic) domiciled in Dublin. From a UK investor tax point of view the fund will be treated in the same way as one domiciled in the UK. The fund (according to its prospectus) intends to be a ‘reporting fund’ for UK tax purposes, which means that gains will be subject to capital gains tax and income, although not distributed, must be declared with any income tax owed being paid.
However, whether you’ll benefit from any investor protection seems the subject of some confusion. The fund’s prospectus suggests that it’s not covered by the Financial Services Compensation Scheme. And on calling both Insynergy and State Street (the custodian/administrator) neither could tell me whether the fund was covered by an equivalent Irish compensation scheme. Insynergy’s press office is now helping to find out and I’ll update this page when I get a definite answer.
As for the fund itself I haven’t looked into it in any detail but the manager, Michael Lai, has performed well running the GAM Star China Equity fund that he’s managed since July 2007. Just beware that the fund has a fairly hefty uncapped performance fee of 20% of returns above 3 month LIBOR (i.e. cash) – this means that at the time of writing you should expect to pay a fifth of any annual returns above 0.66% in fees as well as the standard annual charge of 1.25%.
Insynergy Investment Management was set up by Spike Hughes, a former Hargreaves Lansdown director and boasts ‘dragon’ entrepreneur James Caan as its chairman - not sure whether this is a good or bad thing!
Read this Q and A at http://www.candidmoney.com/questions/question189.aspx
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