Reinstatement of AA-rating for Artemis Income Fund and Artemis High Income Fund back to A-rating; suspension of the AA rating on Kames High Yield Bond fund lifted

Square Mile Investment Consulting & Research confirms it is to reinstate ratings for the Artemis Income and Artemis High Income funds which receive AA and A ratings respectively. At the same time, the Kames High Yield Bond fund has had the suspension of its AA rating removed.

Funds within the Square Mile Academy of Funds carry a rating - A, AA, AAA, Recommended or P+ - as reflection of the level of conviction Square Mile's team of analysts has in a fund's ability to deliver on expectations. Square Mile's independent, qualitative research is designed to offer advisers a solid foundation for client investment propositions and recommendations.

Commenting on the Artemis Income and Artemis High Income funds, John Monaghan, Senior Investment Research Analyst at Square Mile said:

"Having met with fund managers Adrian Frost and Nick Shenton, we are reassured that the management of these funds has not been adversely impacted by the departure of the Income team's third member, Adrian Gosden.

Both managers are fully committed to the ongoing success of the Income franchise at Artemis, in particular Mr Frost who has committed to at least another three years as head of the team. The team will be strengthened over time but the managers are taking careful steps to ensure the most appropriate candidate is selected.

In the meantime, we are pleased to reinstate both funds' ratings at their original levels, AA for Artemis Income and A for Artemis High Income which has around 80% of its assets managed by the group's fixed income team."

Commenting on the Kames High Yield Bond fund, Victoria Hasler, Head of Research said:

"We took the decision to suspend the fund’s rating in June 2016 when the co-manager, Claire McGuckin, left Kames. This departure was at a time when the fund's other co-manager, Phil Milburn, was on a period of leave due to ill health. Whilst we were confident that the fund would be ably managed by David Roberts (Head of Fixed Income) and Stephen Baines (deputy manager of the fund) in Mr Milburn's absence, question marks remained over when Mr Milburn would return to work, meaning that we preferred to be cautious and suspend the rating.

We were delighted that Mr Milburn returned to work, and to the management of this fund, in August 2016, and having met with him in September, we are fully satisfied that he is in good health and well able to manage this fund, although he is currently in a period of phased return. We were also pleased to see that Kames has continued to strengthen its high yield team with the hire of David Ennett who will take up the position of Head of High Yield and co-manager on this fund. Mr Milburn has taken up the role of Head of Strategy, Fixed Income.

Whilst the pair are a relatively new coupling, Mr Ennett has known the team at Kames Capital for many years and we believe that he will work well with them. Mr Milburn retains a 51% vote on this fund which, although we doubt it will be used very often, if at all, gives us confidence that the fund will continue to be run in the considered manner that we have come to expect."