Paris-based boutique DNCA Investments, part of Natixis Global Asset Management, has announced it has soft-launched the DNCA Invest Archer Midcap Europe fund on 24 June 2016.
The fund is managed by Don Fitzgerald (pictured) and Isaac Chebar. It has €43m in assets under management as at end of September 2016.
The investment management team relies on a fundamental analysis approach and selects companies having a durable competitive advantage, solid allocation of capital and alignment of interests between managers and shareholders.
The portfolio comprises of 40 to 65 stocks, each forming 1 to 4% of the fund.
It is understood over 40% of the portfolio is invested in companies with strong capital allocation and consolidation opportunities.
DNCA Invest Archer Midcap Europe is benchmark-unconstrained and aims to generate risk-adjusted yield across a five-year period.
Fitzgerald believes the European mid cap space offers excellent investment opportunities.
“Mid caps have a tendency to structurally outperform larger companies over the long term as they generally offer superior growth prospects and are often M&A targets. Mid caps are less well covered by the investment community, providing ample opportunities to target undervalued enterprises.
“The mid cap space in Europe is currently trading at close to its largest discount to larger companies for the past decade,” he said.