Natixis Global Associates has launched a mutual fund in conjunction with Westpeak Global Advisors.
The fund will be managed by Khalid Ghayur, Stephen Platt and Stephen Komon of Westpeak.
The Westpeak ActiveBeta Equity Fund will seek to outperform the S&P 500 Index by employing a quantitative value and momentum strategy that uses Westpeak’s portfolio construction process.
"Our research shows that broadly diversified portfolios of stocks with value and momentum characteristics can generate long-term outperformance while also reducing the magnitude of potential short-term underperformance relative to the benchmark," says Ghayur. "Our fund advances the active versus passive investing debate by providing a transparent and cost-effective ‘beta’ capture of well-documented sources of market outperformance in a ’40 Act fund."
NGA offers investors five funds: Westpeak ActiveBeta Equity Fund, Gateway Fund, AEW Real Estate Fund, ASG Diversifying Strategies Fund and ASG Global Alternatives Fund.
"This new fund is a great addition to the broad set of diversification tools we have committed to providing to our clients," says John Hailer, president and chief executive officer of Natixis Global Asset Management, US and Asia, and head of NGA US and international distribution. "In a time of volatile markets and widespread uncertainty, investors need access to new types of investments, such as the Westpeak ActiveBeta Equity Fund, to help achieve better overall performance results in a risk-controlled way."
The fund uses a quantitative portfolio construction technique in which all stocks in the S&P 500 Index are ranked independently according to value and momentum signals on a monthly basis. Value signals include price-to-book, price-to-sales and price-to-cash flow (or earnings). The momentum indicator is a stock’s trailing 12-month return. Positions are taken in high value, high momentum and high value and momentum stocks.
Typically, the fund will invest in about 65 per cent of the names in the S&P 500 Index (approximately 325 stocks), taking small positions in each relative to the index.
The portfolio’s weighting of a single security is generally no more than one per cent higher than the index and no less than 1.2 per cent lower than the index.
