Deutsche launches small caps fund

DeutscheAsset Management(DeAM) has launched a new small caps fund, the Deutsche Australian Small Companies Fund, to take advantage of a perceived gap in the market and the group’s strength in Australian equities.

DeAM is targeting master trust and wrap accounts and high-net-worth investors with the new fund, which will have a minimum investment of $100,000, and has a target size of $500 million.

Despite the current difficult environment for equities, the timing of the fund’s launch “couldn’t be better,” according to DeAM’s head of small companies, Stuart Jordan.

“It’s a good time for us to launch and generate some opportunity, as we are well perceived in the equity space, but also there is a gap in the market due to other small companies funds closing, and there is a lot of interest from advisers in this area,” Jordan says.

DeAM’s dedicated three-member small company team expects to draw on Deutsche’s proprietary cashflow valuation methodology and the expertise of the broader Australian equities team to give the new fund an edge over others in the area, which it feels are not as well researched as large cap funds.

DeAM expects the fund to be fully seeded and ready for investment by the end of next week, with research ratings to be released around the same time.