Another Australian-based multi-affiliate funds management firm is planning a foray across the Tasman to build on a couple of existing NZ institutional relationships.
GSFM chief, Damien McIntyre, said the Melbourne-headquartered fund distribution business would test both institutional and retail demand in NZ for its range of specialist managers.
GSFM (known as Grant Samuel Funds Management until early this year) already has two NZ mandates for partner firms Epoch Investment Partners and Payden & Rygel (the latter a recent Mercer appointment).
“We’re interested in seeing the appetite in NZ among both retail and institutional clients for all our managers,” McIntyre said.
For example, last week GSFM struck a deal with Canadian outfit Cambridge Global Asset Management to market its international small companies fund in Australia and NZ.
Cambridge – not to be confused with asset consulting firm Cambridge Partners – is a subsidiary of CI Global Investments, which also owns 80 per cent of GSFM.
McIntyre said the agreement to distribute the Cambridge Global Smaller Companies fund marks the first time GSFM has offered a Canada-based manager in Australasia.
Other managers in the GSFM stable include: Australian global equities house, Munro Partners; Tribeca Investment Partners – another Australian firm investing in equities and alternatives; Sydney-based quant shop, Triple3; and UK-headquartered alternatives behemoth, Man Group.
According to McIntyre, the Cambridge global small cap fund would fill a nearly vacant niche in the Australasian market.
“There’s very few global small cap options represented here – and the couple of funds that have raised money in Australasia are nearly at capacity,” he said.
While Cambridge, which was founded by former Fidelity Investments portfolio managers, has about US$20 billion under management, only about C$500 million sits in the global small caps strategy. McyIntyre said capacity for an international small companies fund likely ranges between US$4 billion to US$5 billion.
He said the global small caps asset class provides “highly persistent alpha” compared to the large companies benchmark with lower volatility than emerging market stocks.
“Most large cap equity managers are under-invested in global smalls,” McIntyre said, which opens up more opportunities for active managers.
In a release last week, he said: “The [Cambridge] fund comprises a high conviction portfolio of 30-50 companies and aims to deliver strong risk-adjusted returns. Emphasis is also placed on identifying companies that trade at a discount to intrinsic value.”
McIntyre has slated a trip to NZ in June.
“We want to scope and the market first and see how we should go about it if we were to commit resources in NZ,” he said.
A string of other multi-affiliate managers including Legg Mason, Pinnacle and Apostle have launched products into the NZ market over the last couple of years – the former two creating portfolio investment entity (PIE) funds under the aegis of Wellington-based Implemented Investment Solutions for respective underlying managers Brandywine Global and Antipodes, respectively.