Investment manager Capital Group is making one of its global equity strategies from the US available to both European and Asian investors, as part of a wider process of expanding into new markets.
The firm, which has recently opened a range of offices and hired a number of business development managers across Europe, is focused on building its wholesale business in the region whilst also servicing global financial institutions.
The new fund will be a Luxembourg-domiciled Ucits fund that will follow the same global investment approach that has been running in the US for over 40 years.
David Polak, an investment director at Capital Group, says the firm has seen growing demand for the new product:
“The first response was ‘oh another global fund’. We then explained the objectives and how it is different. Each time we have spoken about the fund in detail people have shown a lot of interest.
“It seems from the responses that most global funds are organised geographically … what we’ve brought is an objective focusing on companies that have grown out of their home market, I’ve not come across that in the discussions we’ve had.”
The launch will build on Capital Group’s ‘New Perspective’ strategy, which focuses on blue-chip companies that have grown to become multinational, whilst also showing diverse revenue streams and financial stability. These companies typically also have experience of working in multiple currencies, regulatory and political regimes and economies.
The fund will be managed by the same investment team of seven portfolio managers who run the US strategy, which has achieved a return of 13.4% per annum compared with 8.6% for the MSCI ACWI.
Polak sees this approach as a strong example of successful active management, in a climate where active managers are under pressure to prove their worth.
“Somebody said to me that the average active manager doesn’t beat passive, but the point was, who is choosing an average active manager? You need to find areas where what people are trying to achieve is aligned with their skillset.
“Identifying and investing in multi-nationals, because of our global research network is something we should be good at and the track record suggests that over at least the last four decades we have been good at it.”
©2015 funds europe