MGOC ETF Aims for 9% Annual Return with 20-40 Global Stocks and ESG Focus

Introducing the Magellan Global Fund Active ETF

Magellan Investment Partners has released a comprehensive Product Disclosure Statement (PDS) for its new Magellan Global Fund - Open Class Units, trading under the ticker MGOC. This fund represents Magellan's latest foray into the actively managed global equity exchange-traded fund (ETF) space, targeting investors with a high risk tolerance and a long-term investment horizon.

The Fund is structured as a registered managed investment scheme, offering investors the flexibility to buy and sell units on the Securities Exchange or apply and withdraw directly through Magellan. It holds a concentrated portfolio of 20 to 40 global stocks, primarily large-cap companies, with a modest allocation to cash and cash equivalents. Notably, the Fund does not hedge its foreign currency exposure, leaving investors subject to currency fluctuations.

Investment Objectives and Strategy

Magellan aims for the Fund to deliver attractive risk-adjusted returns over the medium to long term, with a specific target of 9% per annum net of fees across the economic cycle. The Fund’s investment philosophy centers on identifying high-quality companies with sustainable competitive advantages, or economic moats, that are undervalued by the market due to short-term mispricing.

The investment process integrates rigorous fundamental research, including ESG (Environmental, Social, and Governance) factors, which are embedded into the quality assessment framework. This approach reflects Magellan’s commitment to responsible investing, excluding companies involved in tobacco, controversial weapons, and limiting exposure to nuclear weapons-related businesses.

Trading and Liquidity Features

Units in the Fund are quoted on the Securities Exchange under specific Securities Exchange Rules, which differ from the standard ASX Listing Rules. Investors can trade units like any listed security, with Magellan providing liquidity by acting as a buyer and seller on the exchange. Additionally, investors may apply for or withdraw units directly with Magellan, subject to minimum initial investments and identification requirements.

The Fund publishes a daily estimated Net Asset Value (NAV) per unit and an indicative NAV (iNAV) throughout the trading day, although prices on the exchange may vary due to market conditions and supply-demand dynamics. The Fund’s liquidity management includes mechanisms to suspend withdrawals under certain conditions, while units may continue trading on the exchange unless suspended by the operator.

Fee Structure and Risk Considerations

The Fund charges a management fee of 1.35% per annum, a modest performance fee of 0.05% per annum based on excess returns over benchmarks, and a buy/sell spread of 0.07% for direct transactions. Investors should be aware of the high-risk profile associated with the Fund, including market volatility, concentration risk due to the focused portfolio, currency fluctuations, and liquidity risks.

Magellan also highlights operational, regulatory, and counterparty risks, as well as risks specific to the Fund’s structure under the Securities Exchange Rules. The Fund operates under the Attribution Managed Investment Trust (AMIT) tax regime, which has implications for investor tax reporting and distributions.

Positioning and Outlook

With approximately $40 billion in assets under management as of September 2025, Magellan Investment Partners brings significant expertise to this new product. The MGOC ETF aims to attract investors seeking long-term capital growth through a disciplined, research-driven approach that integrates ESG considerations. The Fund’s flexible trading options and transparent fee structure position it as a competitive offering in the active global equity ETF market.

Investors considering MGOC should evaluate their investment horizon, risk tolerance, and the Fund’s unique features compared to passive global equity ETFs. The Fund’s success will depend on Magellan’s ability to identify and manage quality investments that can outperform over the economic cycle.