Marlborough Fund Managers has launched a new small and mid cap fund to be managed by Giles Hargreave of stockbroker Hargreave Hale.  

The Marlborough Multi Cap Income fund will invest in around 75 companies listed on the FTSE 250, FTSE SmallCap, FTSE Fledgling and FTSE AIM indices, as well as holding positions in firms at the lower end of the FTSE 100.

The provisional portfolio has over 90 per cent invested in mid and small cap stocks with the remainder in large-cap stocks.

"We have more than 700 companies to select from and among them will be those that, as they go from strength to strength, will pay an attractive dividend that increases year on year as well as providing strong capital growth,” said Hargreave. "The skill lies in identifying those companies at an early stage, which maximises the income yield and the potential for capital growth. It is a specialist field but we have a team with the necessary size, expertise and experience."

The new fund will be co-managed by Siddarth Chand Lall, with support provided by the investment team behind the £410 million ($673.7 million) Marlborough Special Situations fund, also managed by Hargreave. It will launch on 1 July, and is available to investors from Monday.

The Special Situations fund has returned 63.7 per cent in the five years to the end of April, compared with a rise of 36.8 per cent rise in the Hoare Govett Small cap index, according to Lipper.