Why buy the ES R&M UK Equity Smaller Companies fund?

Here are five reasons why investors are paying close attention to Dan Hanbury's portfolio

Well-diversified smaller companies fund with excellent performance history

Multi-category and multi-style small cap fund. Using PVT approach, manager selects attractive stocks from Growth, Quality, Recovery and Asset-backed categories

Between 60-90 stocks, diversified between sectors, and styles

Team able to use experience to capitalise on nuances of smaller companies’ market

Medium-sized fund advantageous for sourcing liquidity.

PVT_Categories_4

Over the years we have found that companies that can deliver above average potential divide into four categories; these relate to where a company is in its ‘life cycle’

Growth

The delivery of strong revenue and profits growth

Quality
Recovery
Asset-backed

The UK equity market is an excellent investment opportunity...

The UK stock market is among the cheapest and most international developed markets in the world

The wide range of under-researched small cap stocks provide a great hunting ground for UK stock pickers

Post the Covid-19 crisis and Brexit, UK management teams can take advantage of a weaker sterling to deliver relatively strong earnings growth.

UK vs. MSCI World Average Valuation Premium

UKvMSCI chart

Source: MSCI, IBES, Morgan Stanley Research. Data to 5 October 2020. Average of Price to Earnings, Price to Book Value and Price to Dividends.

...and within the UK, smaller companies look set to outperform

A history of outperformance, particularly during a recovery

Valuations look attractive at present

UK smaller companies’ market and AIM often used as launchpad for global IPOs, providing additional interest for investors

Less sell-side coverage plus fewer managers searching for opportunities means skilled managers can add a lot more value

Active management can add alpha in a less liquid market where machines cannot reach.

Long-term outperformance of UK smaller companies

UK_smallers_long term perf_3

Source: Numis, as at December 2019.1 Includes the bottom 2% by value of companies on the LSE main market. 2 Includes the bottom 10% by value of companies on the LSE main market.

Highly credible firm and experienced fund manager

Boutique asset manager, run by founding partners, with a history of wealth generation for clients

Dan Hanbury – over 20 years’ experience, a Financial Express (FE) Alpha Manager nine times. In the 2020 FE Hall of Fame

Dan has outperformed in both bull and bear markets

Working within a talented investment team of five portfolio managers supported by seven analysts, all using the PVT (Potential, Valuation and Timing) framework

Highly experienced and well-respected small cap manager.

Dan_Hanbury

A systematic, robust and repeatable process

Quant analysis

Proprietary quantitative screening tool built in 2006.

Fundamental research and risk management

Technology-driven process is backed up by high quality fundamental research, portfolio construction and risk management.

Team

A team and process that is continuously evolving, improving and invested in.

Sustainability

Financially material sustainability factors are integrated into our fundamental research process.

A repeatable process that provides strong risk-adjusted returns over the medium to long term, allows us to “stick to our knitting” and avoid short-term distractions.

PVT_Investment_Process

Strong risk-adjusted returns, low drawdowns

Strong risk-adjusted returns over and above that of the market during upside periods as well as protecting on the downside with some of the strongest drawdown characteristics in the sector.

The fund has good liquidity and is keenly priced – OCF of 85bps (B share class) or 57bps (discounted S share class).

Performance - ES R&M UK Equity Smaller Companies Fund

UKSC performance

Source: FE fundinfo Analytics, B share class (Acc) net of 0.75% AMC. Performance to 31 October 2020. * ES R&M UK Equity Smaller Companies Fund inception 30 November 2006. Quartile ranking is calculated using FE fundinfo Analytics within the IA UK Smaller Companies sector. Any differences are due to rounding.

Speak to us

Simon Smith

Head of Wholesale Distribution

Simon Smith

Head of Wholesale Distribution

Simon is Managing Director, and Head of UK Wholesale Distribution, responsible for creating a market leading customer centric distribution business working with wealth managers across the UK for the benefit of investors. Simon has spent a 25 year career working for some of the industry's leading asset managers including M&G, Standard Life Investments and most recently nine years overseeing the growth of Merian UK Wholesale (Old Mutual Global Investors).

Tom De Lisle

Sales Director, London

Tom De Lisle

Sales Director, London

Tom is Sales Director for London within the Wholesale Distribution team. He looks after a wide range of clients including Discretionary Wealth Managers, Multi Managers, Family Offices, Private Banks and Global Financial Institutions. Tom joined R&M in February 2013. He started his career in financial services in 2004 at a London stockbroking firm advising high net worth individuals on US stocks and helped launch the alternative investments division. He then moved to Neptune Investment Management in 2007 as Sales Manager covering the London and Greater London area and also became Head of Family Office Business Development. Tom has a degree in Modern and Medieval French from the University of Oxford, he holds the IMC certificate and is a member of the CFA UK Society.

Marcus Honig

Sales Director, London & South East

Marcus Honig

Sales Director, London & South East

Marcus graduated from Glasgow University with an MA (Hons) degree in 2001. Throughout his career in financial services Marcus has worked for companies including Chase de Vere, Scottish Widows and Neptune Investment Management, before joining R&M in June 2017. Marcus holds the CII Level 4 Diploma in Regulated Financial Planning as well as the Certificate in Discretionary Investment Management. He is an experienced Sales and Distribution professional with strong client relationships across the UK.

Martin Canavan

Sales Director, North England, Scotland, Ireland & Isle of Man

Martin Canavan

Sales Director, North England, Scotland, Ireland & Isle of Man

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