Argonaut Capital unveils first fund

Although Argonaut Capital will not officially be launched until September this year, senior partner Barry Norris says that if it is to compete successfully it has to concentrate solely on European equity products and not stray into other asset classes.

The group’s flagship fund will be the Britannic Argonaut European Alpha fund, which launched last week.

Managed by ex-Neptune managers Norris and Oliver Russ, the fund will be managed in the same manner as the Neptune European Opportunities fund, which Norris ran before he departed the group for Britannic.

Norris says: “Any other funds we may look to launch will be derivatives of the high alpha fund. For example we may look at launching a European income offering, which could use the core ideas from European Alpha, but include more high-yielding companies.”

Norris describes his investment style as that of investing only in things he expects to make money in. The new European Alpha fund is already invested in 48 stocks and he is confident each of them will produce absolute returns.

He says: “I try not to get bogged down by all the noise in the market; I try to take investment down to the simple proposition of making money in terms of dividend and capital returns.”

There are three main reasons for investing in Europe at present, according to Norris. First, he argues, is valuation. On average, he says, investors are getting paid 3.3% in dividends, compared with the 2% they can get from cash.

Secondly, Norris claims that we are closer to the start than the end of the boom in oil and oil stocks. And lastly, he notes, there are a number of fast-growing countries in Europe at present.

“The biggest bet in the fund at present is Norway, where we have 15% of the portfolio’s assets under management. The economy, which is dependent on oil reserves, is growing at about 3-3.5% per year, which is very attractive in the developed world.”

Launched last week, the new fund will carry an initial charge of 5.25% and an annual management fee of 1.75%.