JO Hambro Capital Management is launching its Global Select and International Select funds next month.
As reported in Fund Strategy (April 14) JO Hambro appointed Christopher Lees and Nudgem Richyal, formerly of Barings, to manage global and Europe, Australasia and Far East (EAFE) portfolios.
Lees, who joins JO Hambro next month, will be senior fund manager, while Richyal will be fund manager. Lees spent 16 years at Barings Asset Management. Richyal, who joined JO Hambro at the end of June, was an investment director within the global equity group of Barings.
The two funds, set to be launched on September 30, are both concentrated portfolios of 30-50 stocks. They will follow the same investment approach, although the Global Select fund will include investment in America, while the International Select fund will not.
The Global Select fund is a Dublin-domiciled Oeic with a minimum investment of £1000, while the International Select fund is intended for institutional investors based in America.
The aim of the funds is to provide consistent returns through looking for stocks with sustainably high or increasing return on equity. The strategy will blend both top-down and bottom-up approaches to stock selection.
“We are looking for companies where we can see there is a catalyst to drive earnings growth,” says Richyal. “It is going to be a core strategy, not deliberately based on value or growth, but the approach will have a slight growth tilt.”
Stocks in the portfolio will include companies with upwards earnings revisions from analysts, particularly where the trend has started within the last two quarters.
“We look for companies where there is a clear trend it’s on the way up or if it’s already high and we are sure that is sustainable,” says Richyal. “We look at the valuation of these stocks on a price to book basis,” he adds.
The healthcare sector is of particular interest to Richyal. It had underperformed for a long time. But in the past 12 months it has enjoyed strong relative performance.
The annual management charge on the Global Select fund is 1.5% while the initial charge is up to 5%.