The two new funds, The Artemis US Absolute Return Fund to be run by Moore and the Artemis US Smaller Companies Fund run by Weldon both have a management fee of 0.75% and complement the US Equity Fund, the US Equity Select Fund and the US Equity Extended Alpha Fund the firm launched on September 15th.
The US Absolute Return Fund is an equity long/short fund, with a cash benchmark of 3 month LIBOR. According to Artemis, the fund will typically hold around 60 long and 60 short positions. And will have a net exposure between -30% and +40%, usually around +15%.
The US Smaller Companies Fund will invest in US companies with a market value below US$10bn and aims to focus on the team’s 50 to 70 best ideas within that space and, it will be benchmarked against the Russell 2000 index.
Asked about the timing of the launch of both the first three funds and the new one, Weldon told Portfolio Adviser, that while the timing of the launch of the big funds could have been better from a market perspective, next week’s launch is good timing as US small and mid-caps have de-rated so much recently.
According to Weldon, despite the recent sell-off, value remains in the US market and, there are no great risks right now from an economic perspective because, at present, nothing is overheating.
“If you look at housing, it is really bumping along the bottom, it is okay, it will be helped by a loosening of mortgage rules but it is not brilliant. Corporate investment is good and corporates have a lot more money that they could spend, but I doubt they are likely to. No one is looking at the horizon and saying everything is great and we can hire more people and build lots of new capacity,” he said.
Weldon added that, in relative terms, the US economy is growing at a reasonable pace. And, while it is not immune from the effects of a slowdown in global growth, it is somewhat protected from it.
Fund flows
In terms of the first three funds, Weldon said the firm had seen good inflows, but there had been more interest in the select fund than the broader equity fund. The select fund currently has around £80m in assets under management, roughly the same level as Moore’s extended alpha fund, whereas the US Equity fund has so far attracted just less than £10m.
