After months of research, London-based Attica Asset Management has selected 15 managers for its new multi-manager product range. The Dublin-based open ended investment company (OEIC) will have seven underlying funds and managers within those funds will be allocated assets on an equally weighted basis to their separately managed portfolios.
Attica, a newly formed company established to provide investment products to UK and continental Europe-based investors, believes this vehicle will be especially attractive to smaller pension funds (both defined benefit and defined contribution schemes). The funds will provide scope for trustees and their advisers to apply bespoke investment strategies regardless of asset size.
“We put together our business plan last year because we thought there was a need for this type of product,” says Guy Davies, a director of Attica in London. “Our philosophy is to hire the highest quality specialist managers for each asset class and to combine these to provide high risk-adjusted relative returns.”
For each asset class, the company has used external research resources for the initial global manager screening, redefining the potential candidates using internal research and criteria.
Attica will source its clients through actuarial and investment consultants, targeting UK and European pension schemes valued between £5m and £50m and, as instigated by consultants, larger specialist mandates. Attica will source European investors via Attica Vermongsbeheer in the Netherlands.
“This product permits smaller pension funds the opportunity to use specialist managers and achieve diversification as larger schemes have done for some time” says Derrick Dunne, who is also director at Attica. “We won’t be giving any advise on strategy or liability work because we think this is the investment consultants’ role.” Attica will invest a pension fund’s assets according to the benchmark provided.
Attica’s team strongly believe that this product will be especially interesting for DC schemes. “DC schemes tend to have a default life time mechanism, where, as members get older and progress towards retirement, they can choose different funds that trustees make available to them,” Davies says. “The problem is that, so far, those options have always been standard managed funds with low performance targets. For this reason, we believe that our funds which target high performance with reduced risk will be very attractive for DC schemes members.”
Both Davies and Dunne previously worked for consultancy firm William M Mercer in London and joined Attica in February.