Australasian small-cap specialist, Pie Funds, plans to launch its own KiwiSaver scheme next year, according to the boutique manager’s head of client services, Sam de Court.
De Court said Pie clients had been pushing the group to roll out a KiwiSaver scheme for some time, “but we told them we’ll look at it when we’re big enough”.
Currently, Pie boasts funds under management (FUM) of about $250 million, he said.
“Now we’re big enough,” de Court said.
Early in August this year, the firm released a new product, the Pie Growth 2 Fund, which he said was created partly in anticipation of its planned KiwiSaver scheme.
“The Growth 2 Fund would be a vehicle for the KiwiSaver scheme to invest into,” de Court said.
He said the Growth 2 Fund would also serve a niche outside KiwiSaver, opening up a new product line for the manager after ‘soft-closing’ three of its Australasian small-cap funds due to capacity constraints.
The manager has shuttered the Pie Growth, Dividend and Emerging funds to new investors over the last couple of years. According to the funds’ latest investment fact-sheets, the Pie Growth, Dividend and Emerging funds reported FUM of $68.3 million, $56.1 million, and $39.8 million, respectively.
“It’s hard to grow your business when your funds are closed,” de Court said.
However, as well as the new Growth 2 product, Pie still offers the Cashplus ($6.5 million) and Global ($51.8 million) funds. The Global fund feeds into a range of nine underlying offshore small cap specialist managers including Mandarline Gestion, Slater, Kayne Anderson Rudrick, William Blair, and East Spring.
Last September Pie also launched the Chairman’s Fund, which invests into the manager’s other underlying products.
“Investments in the fund may be made only by invitation from the Chairman of the Pie Funds’ Board (Mike Taylor),” the Chairman’s Fund prospectus says.
Taylor is also Pie chief executive and chief investment officer. As at March 31 this year the Chairman’s fund reported about $15.8 million under management.
De Court said the proposed KiwiSaver scheme might allow members to tailor strategies via range of Pie funds.
“We haven’t decided yet,” he said.
Meanwhile, de Court said the Growth 2 had performed reasonably well after launching into the most volatile period on markets for years.
“It closed up 2 per cent on August 31, while the ASX small caps benchmark was down for the month,” he said.
According to de Court, Growth 2 plays in a slightly different patch than the original Pie Growth fund.
“While it has the same strategy and purpose [as the original Pie Growth fund], Growth 2 invests at the larger end of the Australasian small cap market,” he said. “Generally, the Growth fund invests in companies with a market cap of between $50 million to $500 million, while Growth 2 invests in stocks with a cap of $500 million to $1 billion – the upper end of small caps and even into some mid-caps.”
The new fund has about $10 million under management with a roughly 50 per cent allocation to cash at the moment.
“We’ve got a high cash allocation in all our funds right now,” de Court said.
Pie Funds was granted its managed investment scheme (MIS) licence last week.