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Future Directions Funds add new managers
The Future Directions Funds have added a number of new managers in recent months in response to changing market conditions.
As part of a review of the global small companies component within the Future Directions Extended Markets Fund, The London Company Investment Council (TLC), River Road Asset Management and Copper Rock Capital Partners will replace the existing managers Rothschild, Ironbridge and AXA Rosenberg.
TLC is a boutique, 100% employee owned US small cap manager which seeks to buy consistently high cash returning companies at a deep discount to their intrinsic value. It was selected for the experience of its key portfolio manager and their long-term investment approach, and will manage approximately 17.7% of the Future Directions Extended Markets Fund.
River Road is also a boutique, 100% employee owned asset management firm. It seeks to invest in undervalued small companies with predictable and stable business models. Its small cap managers have a long history of successful value investing and are supported by a well resourced team of analysts. River Road will manage 17.7% of the Future Directions Extended Markets Fund.
The third manager, Copper Rock, will manage around 15.3% of the Future Directions Extended Markets Fund. It is a boutique small cap growth manager which has a successful history of investing in best-in-class companies at an early point in their growth cycle.
Further changes have been made to the Future Directions Australian Small Companies Fund. The 33.4% managed by the AMP Capital Sustainability Australian Small Companies Fund will be replaced with the AMP Capital Small Companies Fund. This change was made in recognition of its superior expertise in the resources sector of the market and dedicated resources in the small companies sector.
In addition, the Future Directions International Share Fund has appointed Henderson Global Investors (HGI) to manage the 27.5% enhanced index component of the Fund. HGI replaces Black Rock.
HGI uses a portable alpha portfolio construction technique to add value to enhanced index portfolios. Unlike traditional enhanced index funds, alpha is no longer constrained to be in proportion to beta and is equally weighted across North America, Europe and Asia-Pacific, with a focus on multi-strategy, market neutral, absolute return investment strategies.
The HGI team was selected for its relatively unique approach to portfolio construction, the strong leadership of the head of the team and an alignment structure that provides appropriate team incentives to generate alpha for clients. Approximately 27.5% of the Future Directions International Share Fund will be managed by HGI.
Find more information on the Future Directions Funds.
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