Australian-based Pengana Capital is rolling out its Emerging Companies Trust which is a “Mark 2 version” of a fund run by Goldman Sachs JB Were.
Money in the Pengana fund is being managed by Steve Black, the man who until last year ran the GSJBW fund, and Ed Prendergast who has been Black’s primary broker for many years.
The Emerging Leaders fund focuses on the small and medium cap ASX listed companies and also has the ability to invest up to 15% of its portfolio in NZX listed stocks.
The fund is being promoted in New Zealand, ahead of Australia, partly because the GSJBW version of the fund was highly popular with advisers and investors on this side of the Tasman.
Black says the Pengana Fund is slightly different to the earlier one. One difference is that it will be capped at A$300 million. It has an MER of 1.3% which covers all operating costs, however there is a performance fee of 20% of the outperformance of the ASX small companies index.
Black says a key plus of the fund is his and Prendergast’s experience in the small cap sector.
This sector is under-researched and it has the potential to produce strong gains.
Research shows many boutique fund managers can produce excess returns against funds which invest in the full universe of stocks available.
Black and Prendergast own 50% of the fund’s management company the other half is owned by Pengana. Pengana is contracted to provide all the infrastructural services to the fund leaving the two managers to get on and make money.
They say that in the past six months they have made more than 200 company visits.
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