by Niko Kloeten
Castle Point Funds Management has announced it will launch two funds, the Castle Point Ranger Fund and Castle Point Trans-Tasman Fund.
It has also announced investment from the principals of New Zealand Assets Management (NZAM), who will take an equity stake, and Guernsey-based Raw Capital Partners.
The new boutique manager is headed by Richard Stubbs and Stephen Bennie and includes equity analysts Jamie Young and Gordon Sims, representing the entire Tower equity team before it was bought by Fisher Funds for $79 million earlier this year.
But former Tower Investments chief executive Sam Stubbs (no relation to Richard), who was originally said to be tied in with Castle Point, is no longer involved.
Richard Stubbs says Sam Stubbs wasn’t required because NZAM will be providing most of the services a chief executive would usually deal with.
These include back-office support functions such as compliance, accounting, anti-money laundering, settlements, auditing and reporting. Castle Point will be based in the same office as NZAM.
“When we left Tower we were intending to set up Castle Point but we hadn’t got all the pieces of the puzzle together at that point. We wanted a business that was institutional investment grade and one of the things we needed was infrastructure.
“With their involvement they have the ability to offer the services of New Zealand Assets Management. That key infrastructure support allows us to focus solely on investments and means we don’t require a conventional chief executive.”
The Ranger Fund, which will be launched first, is an actively managed portfolio of New Zealand and Australian listed companies selected by using quantitative screening and backed by an intensive research process. Hedging strategies will be employed during periods of market stress.
The Trans-Tasman Fund is a diversified portfolio of New Zealand and Australian companies and will be benchmarked against the NZX50.
Castle Point is banking on continued growth in demand for Australasian equity managers from KiwiSaver inflows.
Co-founder Bennie says once local firms hit one billion dollars in funds under management they can become too big to operate effectively and efficiently because their trades become too influential on share prices.
Niko Kloeten can be contacted at niko@goodreturns.co.nz
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