Whitman Asset Management creates new fund to capture growth opportunities in UK small cap market
Whitman Asset Management (Whitman) has launched a new fund, the TB Whitman UK Small Cap Growth Fund. The Fund, a UCITS OEIC, has already received firm commitments from investors to a value of GBP15 million. Whitman is targeting GBP25 million in the initial stages of the Fund.
The Fund’s objective is to seek long-term capital appreciation from investment in a portfolio of between 30-50 growth stocks within the extensive smaller companies universe, typically with market capitalisations under GBP1.6bn. The predominant focus is on individual company analysis and selection. Four core qualities will be sought by the managers in the investment selection process –
• Exceptional management team with meaningful equity ownership
• Strong and sustainable competitive advantage
• Predictable and strong cash generation
• Virtuous cycle of re-investing self-generated cash at a high level of return
The team managing the Fund will be led by Whitman’s CIO, Christopher Pease, a veteran Small Cap manager previously at Sarasin & Partners and Henderson Investors. Joshua Northrop, previously at Small Cap specialist Hargreave Hale, will be co-manager on the fund.
Araminta Le Flufy, Whitman’s CEO, says: “We are very excited by the early interest already shown by investors in the new Fund. The combination of Christopher’s track-record, small initial size of the fund and the established team at Whitman is a powerful combination. We believe the timing for this launch is right, with the current valuations of UK smaller companies attractive on a historic basis within an asset class where alpha is easier to find.”
Christopher Pease, CIO of Whitman, adds: “The long-term case for investing in smaller companies is stronger than ever. We have identified a lot of extremely well-run and quality businesses. Our private client small cap portfolios have continued to perform well during the Covid crisis: indeed, the crisis has helped throw into sharp relief just how fleet of foot smaller businesses can gain the edge over their larger company competitors. The move to working from home illustrates this. The need for cloud computing, video communications tools and unified communications systems are all features of this developing paradigm from which a number of smaller companies will benefit. Moreover, the further shift to online commerce and digital media forms a natural environment for small, adaptable businesses to thrive.”