Lowes Wealth Management (LWM) expects to unveil its Elite LWM East-West Value fund in October, subject to regulatory approval. The global fund, which will be administered by Way Fund Managers, is likely to be followed by the launch of several regional value-focused portfolios in 2009.
Justin Lowes, the founder of LWM, says the fund will be based on a $3m (£1.6m) strategy, run for discretionary clients since May 2005.
The fund aims to hold “the best 25-35 value companies in the world”, although Lowes says the number of holdings will start at the lower end of the range.
Typical asset allocation for the fund is 30-40% America, 15% Britain and 10-15% continental Europe, says Lowes.
Market caps for stocks in the strategy range from as little as £100m, or £400m in America. However, the average market cap will be £3-5 billion, to ensure liquidity.
Lowes says research for the fund, which is conducted in-house, has been refined over the past three years. A value-based quant screen is followed by analyst presentations at a stock selection meeting. All members of the investment team – which includes Lowes and Markos Tando, the firm’s Beijing-based head of research – have the right to veto companies. “It is a collaborative process,” adds Lowes.
Holdings in the fund are likely to include ConocoPhillips, Sumitomo Electric, Southern Cross Healthcare and Plaza Centers. According to Lowes, the strategy has generated a return of more than 40% since it was launched.
The fund, which is a Ucits III-enabled Oeic, has a minimum lump sum investment of £5,000. The initial charge is up to 5% and the annual management fee is 1.5%, of which 0.5% is payable as trail.