2018 has been a busy year so far for London-based boutique RWC Partners, which has moved into its new London headquarters near Victoria station during Spring as a consequence of business growth.
The firm is looking for more and has appetite for expansion in continental Europe. Speaking to InvestmentEurope, Dan Mannix (pictured), chief executive officer of RWC Partners, says that Germany and Italy are presently core distribution markets to the $15bn manager but that it has plans to develop its business in France and French-speaking Switzerland.
“Last February, we recruited Pierre Giannini as head of Southern Europe and France to look at these markets. We have also decided to make further commitment to Europe with the recruitment of new people. When you have relatively mainstream long-only European and EM equity funds in Europe, the amount of investors that are interested in what you are doing changes. That is a different gear marketing-wise,” explains Mannix.
The boutique’s CEO quotes RWC’s emerging markets, convertible bonds, equity income and L/S strategies “among the most popular strategies across Europe.”
Another focus of the London-headquartered firm has been ESG through a partnership tied with Sustanalytics in research in that field.
Arthur Grigoryants, head of Investment Strategy at RWC, says: “Our partnership with Sustanalytics has been a major step in terms of data and research around ESG. We have formulated our ESG policy at an organisation level and now each of our investment teams tries to implement its own sample. Our emphasis is that ESG considerations must be integrated into decision making. ESG criteria are already considered in the analysis of investment cases.
“The growing fashion of ESG is not about managers looking for the first time at ESG issues but rather managers highlighting them to the surface. Does a company have the right governance structure, can management be trusted, how is the staff treated… ESG research is extremely powerful when you are investing in emerging markets. I am not surprised that RWC’s EM team is the most advanced team on the matter.”
According to Grigoryants, most of the advanced ESG investors are not much into exclusion unless it is required within their mandates and that investors just want to integrate sustainability considerations in portfolios as this is becoming ever more important in daily life.
UK equity income
Lastly, RWC Partners is set to launch a UK value equity income fund next October for which Mannix says the firm has received huge amount of interest.
The fund will be managed by equity value veteran managers Nick Purves and Ian Lance. It will look at valuation opportunities arising from market overreactions and over-emphasis on short-term company and macro considerations.
“The launch of the fund is driven by that client appetite. As it has often happened in past cycles, we have reached a stage where many value fund managers have either stopped their strategy or experienced a drift in their strategies,” observes Dan Mannix.
Arthur Grigoryants adds: “If you look at how value managers operate, you see that value is all about structural change. Looking to value through factor investing may be cost effective and simplistic but it is not optimal. Stocks are cheap for a reason and that is why investors finally turn to experienced people that have been dedicated for years to value and never drifted from it.”