Quilter Cheviot has initiated a position in US small- and mid-caps for the first time as part of its latest portfolio changes.
Managers Simon Doherty and Antony Webb have bought the Artemis US Smaller Companies fund within their US equity ‘building block’ structure.
As a quick reminder, these are Quilter’s in-house products that allow them to pick specific stocks to use within its MPS.
They’ve moved into US small caps becasuse a fall in interest rates later this year would favour smaller, domestic companies – when it eventually arrives, that is.
“The Artemis US Smaller Companies fund offers a clear, consistent and historically successful approach to ‘small cap’ investing that is complementary to our other, largely stock-specific ideas within the allocation,” said Webb.
There have been some alterations in the stock-specific holdings, too.
The Quilter Cheviot team topped up positions in Nvidia and Meta, while reducing its weighting in Alphabet and Mondelez.
Elsewhere, they added to their infrastructure holdings to take advantage of the wide trust discounts currently on offer.
Webb said: "These investment trusts have been at a wider than usual discount in the past 18 months and although they have narrowed recently, we continue to see an attractive long-term return profile from these holdings."
Indeed Quilter is not the only fund selector to have flocked to small caps over the past few months. Asset Allocator reported in March that the folks at Abrdn have taken a liking to two UK funds in particular: Royal London UK Smaller Companies and Janus Henderson European Smaller Companies.
This follows their choice to use the Vanguard US Equity Index as the vehicle of choice, which captures 3,600 companies under its passive umbrella.
