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Fund research

Marlborough Multi Cap Income: May 2024 update

In this fund update, Senior Investment Analyst Joseph Hill shares our analysis on the manager, process, culture, ESG integration, cost and performance of the Marlborough Multi Cap Income fund.

Important information - This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

  • The fund has exposure to small and medium-sized companies offering potential for growth and diversification in income

  • Siddarth Chand Lall has managed the fund since its launch in 2011

  • The fund could add diversification to UK equity income funds focused on larger companies

  • This fund is not on the Wealth Shortlist of funds chosen by our analysts for their long-term performance potential

How it fits in a portfolio

The Marlborough Multi Cap Income fund mainly invests in dividend-paying small and medium-sized companies, instead of the larger companies most UK equity income funds target. These companies can offer greater growth potential because they’re at an earlier stage of their development, although this can also make them higher risk. Because this fund invests differently, it could add diversification to UK equity income funds focused on larger companies or add equity exposure to a broader income portfolio. The focus on smaller companies increases risk and the potential for volatility.


Siddarth Chand Lall has managed the Marlborough Multi Cap Income fund since launch in July 2011. He joined Hargreave Hale in 2007 which is the investment manager to the fund. Hargreave Hale was bought by Canaccord Genuity in 2017, however there has been no change to the investment approach post-acquisition or since launch. Before joining he was an analyst specialising in UK and European smaller companies.

In October 2020 industry veteran Giles Hargreave stepped down as head of investment but retains a consultancy role within the Canaccord group. Longstanding colleague Richard Hallett replaced Hargreave, which ensures continuity of the investment approach.

The manager works closely with income specialist Will Rosier and has the support of the broader small cap team.


The fund aims to provide income and growth by investing in UK shares. It sits in the IA UK Equity Income sector but invests differently from some peers as a result of its exposure to small and medium-sized companies. This approach follows from the manager’s philosophy that smaller companies tend to outperform their larger counterparts over time – although this is not guaranteed, and smaller companies carry greater risk.

Through conducting its own research, the investment team believes it can uncover small and medium-sized companies where the market hasn’t recognised their true worth or growth potential. The fund invests in some larger, more established companies too. Chand Lall looks for good quality companies, whose shares are reasonably priced and either pay a steady dividend now or are expected to increase their dividend pay-out over time.

Following analysis of financial statements and meeting companies’ management, Chand Lall is responsible for deciding how much to invest in each company. He prefers to hold a larger number of stocks in the fund than some peers. There are currently 102 stocks held in the fund. That’s a lot of holdings, but it reduces the risk of any one company’s failure impacting the fund’s returns or the income received.

The biggest sector allocations in the fund are to financials, industrials and consumer discretionary stocks. The manager has made some changes to the fund over the last 12 months, this included the sale of the fund’s investment in building services group T.Clarke following a takeover offer for the business.


Fund managers are employed by Hargreave Hale, an asset manager which was bought by Canaccord Genuity, a Canada-based financial services company, in 2017. Canaccord provides them with plenty of resources while allowing the managers the freedom to run their funds the way they see fit. The way Canaccord rewards them ensures they're focused on the long term, which is a good thing for investors.

Marlborough Fund Managers, from where the fund gets its name, is a separate company. It provides the fund's marketing and distribution and doesn't get involved in the investment side of things. It's an uncommon set up, but one that's been in place for many years, which seems to work well and suit everyone involved.

ESG integration

Marlborough’s focus on smaller companies means integrating ESG is more challenging, given a lack of external research coverage and quality ESG data. However, the firm is increasingly considering ESG factors, with a focus on governance, and has bolstered the quality of the ESG data available to it by incorporating insights from fund managers and analysts.

Some Marlborough fund managers have suggested they’d be prepared to sell a company if ESG concerns couldn’t be resolved. Even so, we believe Marlborough’s ESG integration is at a very early stage, and engagement activity is not as systematic as some peers


The fund has an annual ongoing charge of 0.78%, but through Hargreaves Lansdown you can secure an ongoing saving of 0.19%. This means you’ll pay a net ongoing charge of 0.59%. Our platform charge of up to 0.45% per annum also applies, except in the HL Junior ISA, where no platform fee applies.

Part or all of the annual charge is taken from capital rather than income generated, increasing the potential for your investment’s capital value to be eroded.


Siddarth Chand Lall's managed the fund since it launched in July 2011. In that time, he's delivered returns of 124.39%*, performing similarly to the return of 125.29% from the FTSE All Share index, and 124.64% from the IA UK Equity Income sector average respectively. As is typical of funds investing in smaller companies, returns have been volatile, especially compared with those focused on larger, more stable businesses. Past performance isn't a guide to future returns.

Over the last 12 months to the end of April 2024, the fund has delivered a return of 11.10%, performing better than the FTSE All Share index which rose by 7.50% and the IA UK Equity Income sector average return of 8.07%. Our analysis suggests that the fund’s investments in transport and logistics services business Wincanton and private equity company 3i Group were among the largest positive contributors to returns. In contrast, oil and gas business Diversified Energy Company and self-storage provider Safestore holdings were among the largest detractors from returns.

At the time of writing, the fund has a historical yield of 4.62%. Income isn’t guaranteed, and yields aren’t a reliable indicator of future income.

Apr 19 – Apr 20

Apr 20 – Apr 21

Apr 21 – Apr 22

Apr 22 – Apr 23

Apr 23 – Apr 24

Marlborough Multi Cap Income






FTSE All Share






IA UK Equity Income






Past performance isn't a guide to future returns.
Source: *Lipper IM to 30/04/2024.
Important information - Please remember the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. This article is provided to help you make your own investment decisions, it is not advice. If you are unsure of the suitability of an investment for your circumstances please seek advice. No news or research item is a personal recommendation to deal.
Written by
Joseph Hill
Joseph Hill
Senior Investment Analyst

Joseph is part of our Fund Research team. Having joined HL in 2017 initially on a graduate scheme, he's now integral to our analysts who select funds for our Wealth Shortlist. He also analyses the UK Growth, UK Equity Income and UK Smaller Companies fund sectors, providing expert insight for our clients.

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Article history
Published: 29th May 2024