Guernsey-based asset manager, MitonOptimal, has launched an offshore fund of funds which gives its international clients the opportunity to invest in the UK stockmarket.
The MitonOptimal UK Select portfolio combines two of Miton Group’s UK-focused UCITS – 50% of its UK Smaller Companies and 50% of its UK Value Opportunities – to create a Guernsey-domiciled regulated unit trust scheme.
The two underlying funds invest in UK smaller and mid-cap companies with superior growth prospects or valuation attributions.
The fund of funds will be managed by Gervais Williams, George Godber and Georgina Hamilton who, according to MitonOptimal’s managing director Scott Campbell, will ensure the blend of the two funds is “highly complementary” and “well positioned to deliver exciting returns”.
Williams, managing director of the Miton Group, said he thinks smaller companies will deliver some of the best investment returns in the coming years and decades.
“This is a compelling proposition for investors, providing access to the full range of UK equities from the FTSE AIM Index to the FTSE 100 though a genuinely active investment management approach,” he said.
It targets multi-managers, IFAs and other discretionary advisers for clients in a range of offshore centres, including Guernsey, Jersey, the Isle of Man, the Middle East, Asia and South Africa.
The fund’s minimum and subsequent investments are £5,000. It has an annual management fee of 1.25%, no performance fee and up to 5% upfront fees. The underlying Miton funds will charge 0.75% per year.
MitonOptimal has offices in South Africa, where its domestic discretionary fund management business is based, as well as the Isle of Man and Guernsey. The company currently has $900m in assets under management.
In 2012, the global fund group acquired a majority stake in Argyll Investment Services in Guernsey, which was renamed MitonOptimal Portfolio Management.
“Forethought and patience”
When asked if the UK small-cap fund had been affected by low levels of liquidity, director Shaun McDade said: “The nature of the market is such that trading in small caps, particularly at the lower end of the size range (micro cap), invariably requires some forethought and, at times patience in order to achieve optimal pricing on both the bid and offer side.
“This has always been the case and such requirements are part and parcel of the small-cap manager’s skill set. The fund is not of a size that causes significant problems in this regard and is also sufficiently diversified, in terms of underlying positions.
“Moreover, investor flows have been relatively stable; as such, the manager has not been unduly hampered by the prevailing liquidity conditions in the market.”