FOR PROFESSIONAL INVESTORS ONLY. THIS IS A MARKETING COMMUNICATION
5
Presenting the Artemis US Smaller Companies Fund
The investment philosophy focuses on finding scalable, profitable small-cap companies, using what Micklem calls the team’s “up down process” to assess potential returns and risks.
“What we are trying to understand is not only how much opportunity there is to make a return from an investment, but also what is the risk something goes wrong,” she says.
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Process
“We are not looking down the micro-cap, at the deeply unprofitable end of the spectrum,” she says.
The fund typically holds 40-60 stocks, out of a possible investment universe of over 2,000. Micklem says this ensures the portfolio remains focused – but that it also holds enough stocks to ensure diversification, helping to mitigate the higher levels of volatility often seen in smaller companies.
IMPORTANT INFORMATION
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Third party endorsements are not a recommendation to buy. For sources, dates and other information, visit artemisfunds.com/endorsements.
FOR PROFESSIONAL INVESTORS ONLY. THIS IS A MARKETING COMMUNICATION
5
Presenting the Artemis US Smaller Companies Fund
Artemis defines US smaller companies to be those stocks with a market capitalisation below $10bn.
According to Cormac Weldon, these companies are currently at their cheapest relative value to large caps – namely the S&P 500 – for 30 years.
“These companies are active in and a product of the most developed venture capital market in the world, which drives innovation and growth and makes for a highly dynamic environment,” says Weldon.
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Asset class
Weldon says one of the key characteristics of smaller companies is their domestic focus. Unlike the S&P 500, which is dominated by global companies with international revenues, he notes the Russell 2000 – the Fund’s benchmark index – derives the majority of its revenues (almost 80%) from the home market.
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“As well as accessing the growth of the world’s largest economy, we see investing in US smaller companies as a way of more directly capturing the intricacies of the US economy,” Weldon adds.
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Third party endorsements are not a recommendation to buy. For sources, dates and other information, visit artemisfunds.com/endorsements.
* Excluding formal firm-wide and fund-level exclusions
FOR PROFESSIONAL INVESTORS ONLY. THIS IS A MARKETING COMMUNICATION
5
Presenting the Artemis US Smaller Companies Fund
In this Fund in Five, we talk to Co-Fund Managers Cormac Weldon and Olivia Micklem to look at the portfolio from five angles and understand the opportunity in US Smaller companies, which are trading at multi-decade lows in relative terms to their larger peers.
October 2024 marked 10 years of the Artemis US Smaller Companies Fund. Using their up/down framework and deep understanding of industry cycles, the managers seek to find the winners in sectors that are benefiting from domestic tailwinds.
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IMPORTANT INFORMATION
Third party endorsements are not a recommendation to buy. For sources, dates and other information, visit artemisfunds.com/endorsements.
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Asset class
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Process
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Differentiators
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Team
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Track record