Alternative investment manager Capital Fund Management (CFM) will open an office in Australia next year, with aims to further build out its local retail business.

Addressing a media lunch in Sydney yesterday, CFM head of Asia-Pacific Steve Shepherd said the fund manager, which specialised in alternative beta strategies, had recorded growth in both its retail and institutional business in Australia as an increasingly sophisticated cohort of investors looked for a low-cost way to add alternatives to their portfolios.

“We want the ability to spend more time in this market not only from a sales perspective, but we have a growing roster of clients who we would like to be able to service and answer questions when they have them,” Shepherd said.

“We have about $1 billion in [assets under management] from the institutional side with significantly more in the pipeline, but we also have a burgeoning business on the platform side with our unit trust vehicles which are available on a number of the platforms, and that is a growing part of the business in wealth management groups, family offices and dealer groups.”

The group would look to recruit up to five local staff in the investor relations, marketing and sales functions, with a focus on candidates who had an equal balance of technical and personal skills, he said.

“Given the nature of the business there is a high component of it which is being able to understand the strategies we do – we need people who are able to relate to people, but who are also able to relate to the research team and be able to articulate what can seem like formidably challenging scientific topics,” he said.

“That is a very challenging thing to have people who are on the one hand solidly technical, but on the other able to communicate well with investors.”

The group partnered with Winston Capital Partners for its retail distribution and recently attained Lonsec ratings for its two retail funds, the CFM ISDiversified Trust and CFM ISTrends Trust, which were available on a number of adviser platforms, including Hub24 and Netwealth.

Winston Capital Partners founder Stephen Robertson said the funds had been positively received by advisers, given the low price point they offered compared to similar products in the retail market.

“There are other trend-following funds in the retail space where the lowest management fee is 1.3 per cent with an average performance fee as high as 20 per cent, whereas CFM’s trend-following fund has a fee of 80 basis points including expense ratios and a performance fee of 10 [per cent],” Robertson said.

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CAPITAL FUND MANAGEMENT LLP (CFM)
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