Lonsec rates recently launched Sestante Australian Small Companies Fund “Recommended”
As part of its broader asset management strategy AZ Sestante has launched the Sestante Australian Small Companies Fund (the Fund) on 1 March 2017, in conjunction with fellow Azimut subsidiary Sigma Funds Management (Sigma). Sigma will act as the investment manager for the fund with AZ Sestante as responsible entity.
The fund is managed by Issam Eid, Rajeev de Silva and Stephen Giubin, who have been together for 10 years running this capability at Sigma and previously at Credit Suisse. The fund invests primarily in stocks outside the Top 100 and typically holds between 45 and 55 stocks. Capital preservation is also very important with the fund having the ability to hold up to 20% in cash. The fund has a management fee of 1.0763% with a performance fee of 20% of after fees returns once the fund outperforms the S&P/ASX Small Ordinaries index by 2%.
Sigma has been running this strategy since early 2010 and over that time have outperformed the index by 5.0% per annum. In the 12 months to 31 March 2017 it outperformed the S&P/ASX Small Ordinaries index by 12.6%. As part of their recent Australian Smaller Companies review, Lonsec has assigned the fund a “Recommended” rating. Lonsec highlights some relative strengths, including the experienced small cap team, the impressive industry track records of the individuals involved and the disciplined focus on maximising risk-adjusted returns. Another relative strength highlighted is the Fund does not have any capacity concerns.
AZ Sestante Head of Distribution, Andrew Davies said “I am very excited to be bringing such a strong capability to the retail market in an asset class that constantly seeks experienced, high quality fund managers with capacity.”
Issam Eid, Portfolio Manager, Sigma Funds Management stated “I am extremely pleased that whilst the Sestante fund was only recently launched, Lonsec have based their view taking into account the team’s strong, long term track record in managing Australian Small Companies both here at Sigma and at other fund managers.”
