We asked the Van Lanschot advisor: What makes a fund interesting?
How and when did you learn about the Kempen (Lux) Global Small-cap Fund?It was shortly after Kempen had introduced it. The concept appealed to us immediately. At that time, there were few funds that focused on global small caps. Kempen already had a few small-cap funds, but no global fund. Moreover, I knew fund managers Jan Willem Berghuis and Chris Kaashoek very well from the time that I worked at Kempen myself. I was convinced of their knowledge and expertise and had every faith that they would make a good job of it, even though the fund had not yet proved itself. That’s why I undertook to bring it to the attention of our clients.
What makes the fund interesting for the clients you and your team work for?Our clients are classed as professional investors. They make their own decisions and have the necessary experience. They construct their own portfolios, usually buying individual equities. These do not usually include international small caps. It is almost impossible to invest in small caps as an individual as it requires highly specific expertise. Yet it is possible to earn sound returns. This is what makes it an interesting proposition to put to our clients. Many of them have decided it is an appropriate solution to add to their portfolios. There may not have been a track record, but there was a belief in the team and the modus operandi.
How do you see the fund managers’ modus operandi?They put a great deal of effort into carefully selecting the companies in which they invest. It is precisely in small caps that you can make a difference by doing so. There is more emphasize lately on the passively-managed index funds, but fund managers can genuinely add value in the small-cap segment. The fund managers conduct a thorough preliminary selection, but also pay visits to companies and talk to their management. The broad diversification, the experience in the team and the sound process behind the fund lead me to believe that it will continue to perform well in the long term.
“What particularly appeals to me is the open style of communication, both online and in direct contacts with the fund managers”Niels van de Westelaken
The fund now has a three-year track record. How do you look back on the past three years?The fund has lived up to expectations. It is outperforming its benchmark, the MSCI World Small Cap Index. What particularly appeals to me is the open style of communication, both online (including via the website) and in direct contacts with the fund managers. They explain very clearly why they have taken certain decisions and why they made certain alterations to the portfolio. Even if investments do not yield the desired result, they provide an explanation. If we have any questions, they are happy to help. Furthermore, one of the fund managers often accompanies us to clients or prospects in order to provide more detailed information about the fund.
Now that the fund has built up a good three-year track record, I think more institutional clients will find their way to the fund. Many of these investors will not invest until a track record of at least three years has been acquired. Private investors set less store by this, as they are often more willing to place their trust in the managers. And that trust has proved well-founded in this case.
About Niels van de Westelaken
- Manager of the professional desk at Van Lanschot Bankiers
- 11 years at Van Lanschot Kempen (5 years at Kempen Securities and 6 years Van Lanschot)
- Manager of the investor advisory committee for Professional Investors
- Avid cyclist and proud owner of a 1961 Austin Healey which is used for rally driving