Manager Research

We have recently concluded our review of the Perpetua SCI Equity Fund. During 2021, we downgraded the fund to Tier 2 and we have spent time during this review assessing whether our concerns with the fund are still relevant. Ultimately, we continue to believe that a Tier 2 rating for the fund is appropriate.  

On the business and shareholder side, we have historically been concerned with slowing client and asset growth. In general, this can raise business longevity concerns, although we have seen positive developments in this area since our last review. We feel that the business is now on a healthier trajectory that it was in 2021 and there is greater potential for the business to increase assets and diversify its client base from this point forward.

Although the core team that manages this fund has been relatively stable, we have seen broader turnover within Perpetua over the past seven years. We have explored this in detail with Perpetua and the majority of our concerns have been allayed.

Lastly, we have also had some concerns in the past about the track record that the fund has developed. This has made it difficult for us to map the value centric investment process back to realised investor outcomes. Perpetua has been aware of this issue and have since taken steps to amend parts of their portfolio construction process. More recently, the performance profile of the fund has been more in line with our expectations which is positive.

The neutral to largely positive developments and a stronger understanding of the above three areas of concern have meant that we are comfortable maintaining the Tier 2 rating on the fund.