Crux Asset Management has announced the launch of a new European equity fund, the FP Crux European Fund, on 12 October.
Richard Pease and James Milne will manage the fund. It will invest in a concentrated portfolio of 40 to 50 stocks, primarily large cap European stocks, focusing on businesses that are best-in-class on a global level.
The FP Crux European Fund could be invested up to 10% in non-European listed global stocks. The fund may also take unconstrained exposure to the Swiss market and allocate up to 5% in the UK.
The stock selection process is based on four key criteria :
– Companies that are not highly capital intensive but generate good cash-flow that is either invested in the business, put to work in corporate actions such as M&A or returned to shareholders as dividends.
– Companies with high barriers to entry and strong pricing power, enabling them to produce robust earnings with good growth potential.
– Businesses whose management have proven track records as well as meaningful stakes in the companies they run
– Companies that have relatively conservative valuations versus their peer group.
The fund aims to deliver a return of 2.5-3.5%.
Crux AM was established in 2014.