Harbour Asset Management will diversify its global shares exposure with a new fund on course to accrue $150 million by Christmas.
The soon-to-launch Harbour portfolio investment entity (PIE) will tap into a concentrated ‘quality’ international shares strategy managed by Canadian-owned firm, TD Epoch.
Due to go live mid-July, the Epoch PIE joins the growth-oriented T Rowe Price on the Harbour global equities bench.
Chris Di Leva, Harbour head of multi-asset and global investments, said the Epoch Global Quality Select Equity Fund PIE would kick off with over $20 million.
“We expect to reach $150 million by year-end,” Di Leva said, after receiving interest from both institutions and advisory firms.
The Epoch PIE will also fit into the Harbour multi-asset fund, which currently has about $1 billion under management. However, the new PIE has not been slated yet to appear on the Harbour-managed BNZ KiwiSaver and retail funds menu: BNZ is currently reviewing its global asset managers.
BNZ funds now fall under Harbour purview following the merger of the bank-owned investment business with Jarden and JBWere into the FirstCape conglomerate earlier this year.
But Di Leva said the search for a T Rowe complement began almost two years ago, well before the FirstCape deal hove into view.
“We started with a long-list of managers at the end of 2022,” he said. “And we’ve tracked Epoch for 18 months so we have a good feel for how they operate.”
The Harbour vehicle feeds into the Epoch strategy targeting companies with ‘free cash-flow’ that reinvest profits to fuel growth rather than pay dividends.
Epoch also has a dividend-focused global shares fund.
Di Leva said the Epoch capital reinvestment fund fits better with the Harbour growth bent while also complementing the T Rowe Price strategy.
“We did consider value funds but the core quality style of Epoch is more philosophically aligned with us,” he said.
The New York-headquartered Epoch also has stable ownership and management teams, Di Leva said.
Harbour manages almost $500 million in two T Rowe Price PIEs – the first launched in 2015 followed by a hedged version six years later.
The Epoch portfolio, established in 2013, typically holds about 40 stocks selected through a quantitative and qualitative investment process.
Founded as Epoch Investment Partners in 2004, the manager was acquired by the Canadian Toronto Dominion Bank in 2013 and rebranded as TD Epoch only last year.
Epoch, which has more than $50 billion under management globally, opened a Melbourne office in 2019. The firm also has previously secured institutional clients in NZ including Nikko Asset Management.
Nikko used Epoch in its global shares multi-manager fund until 2018.
Harbour now operates three offshore asset PIEs with T Rowe Price, Epoch and the global fixed income Hunter fund (managed by PIMCO) – the latter purchased from Implemented Investment Solutions in 2021.
After picking up the BNZ Australasian assets post-FirstCape, Harbour has over $11.6 billion under management.