EFG Asset Management (EFGAM) has added to its UCITS range with the launch of the New Capital US Value Fund in partnership with the US value pioneer Schafer Cullen Capital Management.
The New Capital US Value Fund is sub-advised by Schafer Cullen Capital Management’s New York- based investment team, which manages over USD 14 billion of assets in US value strategies. The new Fund’s advisers are Jim Cullen and Jennifer Chang.
The Fund aims to have a maximum of around 45 holdings and rigorously follows a low price-earnings discipline. While it is a US all-cap equity portfolio, it will invest primarily in companies with a market capitalisation exceeding USD3 billion. Given the focus on quality, the managers will also look for companies with strong growth in earnings per share and strong operating and free cash flow, with low debt-to-equity ratios. The portfolio consists of around 20 per cent small- and mid-cap stocks and 80 per cent large caps.
The Fund is diversified across 15-20 industries, with the top 10 holdings representing 30-35 per cent of the Fund’s value. It will typically invest in companies that, we believe, are sector leaders with proven advantages relative to their competitors but pursue simple, defensive business models and generate robust recurring cash flows.
Jim Cullen, CEO and adviser, Schafer Cullen Capital Management, says: “There is no denying that growth investing has had a fine run. Yet the spotlight is seeking out value as the economic recovery emerges and consumers start to increase their spending. This is further supported by the search for yield in an environment of near zero interest rates, with many value stocks offering steady dividend yields.”
Moz Afzal, Global Chief Investment Officer, EFGAM, adds: “We are excited to be launching this new fund at this time. Jim Cullen and Jennifer Chang have a long track record in running US value portfolios over a number of market cycles. As the world battles through the current crisis and looks ahead to a post- pandemic era, we believe this is the right time to exploit the value end of the investment spectrum and provide our clients with much sought-after value opportunities.”
