MFS fund seeks untapped ‘contrarian’ opportunities in equities

MFS Investment Management has repackaged its popular Contrarian Capital investment strategy into a new actively managed trust available for Australian wholesale and institutional investors, following a spike in investor demand.

The MFS Global Contrarian Equity Trust, while providing local market participants with exposure to the MFS Contrarian Capital strategy, is modelled after the manager’s Contrarian Value strategy which has been closed to new investments since 2023 due to its capacity limit being reached.

The trust leverages a bottom-up fundamental investment approach in its selection of between 30 and 60 large-cap stocks, chosen particularly for their “divergences” between price and value amid experiences of controversy, transition, corporate restructuring, special situations, cyclical or structural adjustments, or a temporary impairment of the business model .

A team of global analysts support the research process behind the trust across regions, industries and markets, presenting a diversified portfolio of global equity securities in both developed and emerging markets.

The trust is backed by the same investment philosophy and leaders used by the overarching strategy, co–portfolio managers Anne-Christine Farstad and Zahid Kassam.

“The MFS Global Contrarian Equity Trust combines the best of MFS’ contrarian investing expertise and risk management with a unique mandate designed to complement and diversify global equities exposures within Australian portfolios,” Josh Barton, Senior Managing Director and Head of Australia and New Zealand, said.

“At a time when global equity markets are being shaped by forces unprecedented in nature and magnitude, creating more pockets of price dislocations, the trust may provide investors with the value characteristics they seek, while diversifying their equity exposures and providing more flexibility than some of the more dogmatic deep value strategies.”