Société Générale unveils onshore fund to lure British investors

Société Générale Asset Management (SGAM) launched an onshore mirror of its $5 billion (£2.4 billion) US Relative Value fund last week.

The launch follows its failure to attract enough interest from British investors for the offshore version.

The US Relative Value fund is managed by Diane Jaffee, from TWC, the SGAM-owned America-based subsidiary TCW.

The fund seeks undervalued larger company stocks where the company has a fundamental catalyst or competitive advantage.

The fund, which was launched in 2001, operates within a universe of about 4,000 stocks with market capitalisations of about $1 billion.

A bottom-up strategy is used to select companies with an attractive risk/reward ratio and those that have the best chance of realising competitive advantage.

Holdings in the portfolio range from 1% to 5%. Annual turnover within the fund is typically 30-60%.

Mik Bates, head of UK Marketing at SGAM, says the fund is the largest within the group’s Sicav range.

“It’s one of the most popular offshore funds,” he says. “But it failed to attract the money [in Britain] that we had hoped it would. It has had UK distributor status since 2005, but since then it became noticeable that little of the money going in was coming from the UK.

“When we ask people why, they say it’s because it’s not a UK fund. It’s not as convenient.”

Bates says the group expects better inflows from British investors. “Now we have no excuse,” he adds.

Over five years to November 26, the SGAM US Relative Value fund ranked 76 out of 288 funds in the Morningstar Global Investment Fund Sector Equity North America.

It returned 28% compared with an average sector return of 21%.