Big opportunities for small caps
Mariner Financial has launched a new small companies fund designed to capitalise on what the company regards as an undervalued Australian small-cap market and featuring a unique, medium-term lock-in investment period.
The Mariner Small Companies Recovery Fund, available to retail and wholesale investors, will be managed by Ausbil Dexia and Souls Funds Management and target undervalued, listed Australian companies expected to increase in value over the medium to long term.
“We are pleased to announce the launch of this unique fund, which will benefit from recovery in the small companies market following the significant volatility and sell-down over the last six months,” Mariner executive chairman Bill Ireland said.
Mariner listed equities and securities manager Nick Thorne said the fund’s lock-in period, which prevents redemptions until July 2010, was put in place to ensure investor returns are not diluted by redemptions.
“We wanted to provide the right investment structure that will allow the managers the scope to invest in these oversold small-cap companies and not have to liquidate their positions because of the behaviour of short-term investors.”
Ausbil Dexia equities director John Grace said there is ample opportunity for investors to take advantage of value returning to the small-cap space after the significant market correction.
“The current bear market in small-cap industrials has left many companies trading at decade lows and well below our assessment of fair value. Investing in these opportunities now offers significant medium to long-term returns,” added Souls chief executive Frank Vilante.
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