Veteran investor and manager of the Fundsmith Equity Fund (B41YBW7), Terry Smith, has cashed in his holding in UK testing and certification business Intertek (ITRK) and switched into US consumer products group Church & Dwight, makers of Trojan condoms and the iconic Arm & Hammer-brand toothpaste and baking soda seller.

Smith is thought to have doubled his money in Intertek, having bought it first back in 2015 and again in 2017. Meanwhile Church & Dwight shares have lagged the S&P 500 index since peaking last August as ‘value’ stocks have come back into favour.

The sale and purchase come after December’s decision by Fundsmith Equity to sell out of UK consumer goods business Reckitt Benckiser (RB.) and buy shares in the world’s largest luxury goods company, France’s LVMH.

Last year Fundsmith Equity comfortably outperformed the MSCI World index (GBP Net), with a return of 18.3% compared with 12.3%, marking four consecutive years of outperformance. In fairness, in 2016 Fundsmith equaled the MSCI World Index with a 28.2% return.

According to the fund’s latest factsheet, the top five contributors last month – when the fund returned 1.1% against 0.7% for the index – were holdings in cosmetics maker Estee Lauder, payments firm Paypal, diagnostic instrument-maker IDEXX, airline reservation software business Amadeus and hotel group InterContinental Hotels (IHG).

DISCLAIMER: Daniel Coatsworth who edited this article has a personal investment in Fundsmith Equity Fund


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Issue Date: 02 Mar 2021