Future of trust launched by Mark Mobius in question as investors sell almost half of fund’s shares

The future of the Mobius Investment trust has been called into question after investors sold almost half of the fund’s shares in a three-yearly redemption facility.

The £167m Mobius Investment trust is set to lose around £72m after investors sold 43% of its shares, reducing assets to below £100m, the level seen as a minimum threshold by institutional investors.

The emerging markets smaller companies investment trust – co-founded by EM guru Mark Mobius in 2018 and run by Carlos von Hardenberg – received redemption requests for over 49.7m shares ahead of yesterday’s deadline (3 November).

Although the trust was only trading at a 7% discount, it has underperformed over one year returning 6% against the 38% sector average, according to a note from QuotedData.

QuotedData’s head of investment company research James Carthew said: “With less than 5% of its assets in China versus a weighting of over 31% in the MSCI Emerging Markets index, Mobius has largely missed out on this year’s rally in Chinese stocks. Consequently, its three-year performance figures are some way behind the sector median.

“It is not surprising that a sizeable proportion of its share register has opted to take advantage of the three-yearly liquidity opportunity. The market cap will likely fall below £100m, which may raise questions about its viability.

“I don’t have a problem with small trusts (as long as they keep their overheads under control) but Mobius will need to demonstrate that it can turn its performance around.”