Artemis Short-Duration Strategic Bond
Artemis Short-Duration Strategic Bond fund is a ‘Steady Eddie’ targeted absolute return fund, with a heavy emphasis on controlling risk. It targets an annual return of at least the Bank of England Base rate + 2.5% after fees and invests globally in government and corporate bonds as well as asset-backed and mortgage-backed securities.
Previously Artemis Target Return Bond
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Stephen began his career at Aegon Asset Management (now Kames Capital) in 1994, after earning a BSc and MSc in Finance from Queen’s University Belfast. By 2000, he was managing Kames’ Sterling Corporate Bond Fund. In 2004, he moved to Old Mutual Asset Managers to run their corporate bond fund, before returning to Kames in 2011 as co-head of fixed income, co-managing several funds including the Investment Grade Bond and Absolute Return Bond funds. In 2019, Stephen joined Artemis from Kames Capital, bringing four other fixed interest team members with him.
Jack co-manages Artemis’ Global High Yield Bond, High Income, and Short-Duration Strategic Bond strategies, as well as the bond component of the Monthly Distribution strategy. He joined Artemis in June 2019 from Aegon Asset Management, where he co-managed high yield bond funds and the Strategic Bond strategy since 2016. Previously, Jack was an investment analyst at Standard Life Investments and began his career as an economist at Cambridge Econometrics. He graduated with a first-class honors degree in economics from Trinity College Dublin and is a CFA charterholder.
Liam leads the Artemis fixed income team’s strategy on macro and rates. He joined Artemis in November 2023 from abrdn, where he was head of nominal rates and managed several strategies, including the abrdn Strategic Bond fund. He holds a degree in Theoretical Physics from Trinity College Dublin.
Stephen began his career at Aegon Asset Management (now Kames Capital) in 1994, after earning a BSc and MSc in Finance from Queen’s University Belfast. By 2000, he was managing Kames’ Sterling Corporate Bond Fund. In 2004, he moved to Old Mutual Asset Managers to run their corporate bond fund, before returning to Kames in 2011 as co-head of fixed income, co-managing several funds including the Investment Grade Bond and Absolute Return Bond funds. In 2019, Stephen joined Artemis from Kames Capital, bringing four other fixed interest team members with him.
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Jack co-manages Artemis’ Global High Yield Bond, High Income, and Short-Duration Strategic Bond strategies, as well as the bond component of the Monthly Distribution strategy. He joined Artemis in June 2019 from Aegon Asset Management, where he co-managed high yield bond funds and the Strategic Bond strategy since 2016. Previously, Jack was an investment analyst at Standard Life Investments and began his career as an economist at Cambridge Econometrics. He graduated with a first-class honors degree in economics from Trinity College Dublin and is a CFA charterholder.
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Liam leads the Artemis fixed income team’s strategy on macro and rates. He joined Artemis in November 2023 from abrdn, where he was head of nominal rates and managed several strategies, including the abrdn Strategic Bond fund. He holds a degree in Theoretical Physics from Trinity College Dublin.
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Company Description
UK-based Artemis was founded in 1997 as a limited liability partnership. Affiliated Managers Group (AMG) and the management team at Artemis own 100% of the equity of the business. This is a financial partnership; AMG takes a share of the revenues produced by Artemis but does not get involved in the day-to-day running of the business. A recipient of the Elite Provider for Equities rating in 2015, 2016, 2017, 2018 and 2020, Artemis has retained its manager-centric, innovative and supportive culture, which has helped it to attract and retain talented investors.
Fund Performance
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Talking Factsheet
Investment process
The manager’s philosophy is that markets are inefficient and financial operators often behave irrationally. Liquidity constraints, portfolio and benchmark restrictions - and increasingly passive strategies - all create opportunities for the active manager.
To take advantage of this, the fund is flexible and targets investments across the fixed income market with the ability to go both long and short. The investment process begins with an assessment of macro fundamentals; the economic cycle and inflation, the outlook for monetary and fiscal policy and political and regulatory risks. The team will then analyse valuations across the fixed income market. Where is the value? Is there compensation for the risk? What is the current sentiment and what is the potential downside? Technical factors such as supply and demand imbalances and unconventional monetary policy are also considered.
Maximising risk-adjusted returns is the goal and the fund looks to generate returns from six different sources; asset allocation, stock selection, ratings, sector selection, yield curve and duration.
The fund is broken down into three different modules: credit, rates and carry. The carry module is generally expected to be the least volatile module and is made up of short duration investment grade credit with up to three years to maturity. Callable bonds, which can be riskier, are not held in this short duration module.
The rates module focuses on government bond markets across the world. It will incorporate the team’s view on inflation, interest rates and yield curves
The credit module is all about fundamental research and finding stock-specific opportunities across investment grade, high yield and emerging markets.
Risk
The three different modules allow for good diversification which helps to manage risk. However, from a risk perspective the fund is managed as a whole. The fund does not maintain a minimum risk level but risk is managed very carefully and follows a strict stop loss policy. Any position which costs the fund more than 10 basis points is immediately reviewed. High yield and emerging market exposure is capped to a maximum of 40%.
ESG
ESG - Integrated
Stephen acknowledges that ESG factors can be a material driver of company fundamentals and as such, incorporates analysis of these factors into the process. This work is done internally, rather than bought in from a third-party, and performed in conjunction with the fundamental, technical and economic analysis already performed on a stock. Stephen believes this work is based around qualitative factors rather than providing a score, so he needs to integrate them within the stock analysis to ensure they are best captured in the overall analysis of a security. ESG factors are considered at both an individual stock basis and at a portfolio-wide level to ensure no unintended risks are systematically taken.
The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund nor of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.