Artemis says it launches new funds only when it has the expertise on board and when market conditions are suitable. The strategic assets fund is the first new fund from the company in four years and as a multi-asset fund structured under Ucits III, it can move between equities, commodities, fixed interest and currencies as market conditions change. It can also create short positions using derivatives.
The fund aims to beat equities and cash over rolling three-year periods. It will be defensive in bad markets to preserve and reasonably invested in good markets to capture growth.
Fund manager William Littlewood was a star fund manager at Jupiter, where he worked between 1989 and 1999. He joined Artemis in December 2005 to manage its absolute return hedge fund.
In managing the new fund, Littlewood will draw on the resources and expertise of Artemis’ 16 other fund managers. Equities will provide the core of the fund and within that, the focus will be on the UK, with some exposure to other countries such as the US to provide global diversification. He can go up to 30 per cent short of equities using derivatives.
Littlewood will be able to invest in corporate and government bonds but prefers the high yields available through corporate bonds as an attractive alternative cash. He can go up to 100 per cent short on government bonds, which is useful to act on his belief that quantitative easing the UK and US will eventually lead to higher inflation.
Commodities will be accessed though exchange traded funds in three areas – precious metals, oil and agricultural products. Littlewood can also invest in currencies, going short where he thinks a country’s economic outlook is poor and going long where it seems strong.
Artemis has entered the multi-asset market later than many fund management groups but this reflects its commitment to launching funds only when its skills and market conditions are conducive.
Littlewood brings a track record in long and short investing to the new fund, but its success depends on his ability to go long and short in the right assets at the right time.