Asset Manager Overview
Artemis is an investment management business which was founded in 1997. Since then, it has grown and as of the end of January 2025, it had circa £28 billion of assets under management across a range of investment funds, investment trusts and segregated mandates. The firm is 100% owned by the management team at Artemis and Affiliate Management Group, with the latter taking a share in revenues but not involved in day-to-day management.
The firm operates under a Limited Liability Partnership (LLP) and currently has circa 30 partners made up of fund managers and other key individuals in the firm. This approach to ownership has meant the firm has been able to retain key individuals in the business, with fund manager turnover relatively low. In addition, fund managers typically invest in the funds that they and their fellow managers run, ensuring their interests remain aligned with those of their investors. Each of the firm's investment teams operate independently and so are free to pursue different investment philosophies and processes, with the managers wholly accountable for the assets they manage.
Fund Manager/Team Overview
The portfolio is managed by a team of three co-portfolio managers: David Ennett, Grace Le and Liam O'Donnell. There is some familiarity in the new team as David and Liam worked together at Aberdeen Investments in addition to Grace working alongside David at Aegon. They bring their best ideas from their respective areas of expertise and implement them as a collective.
David, high yield portfolio manager, joined Artemis in February 2019 from Aegon, where he was Head of High Yield since 2016. Prior to this, he was Head of European High Yield at Standard Life Investments and previously a high yield portfolio manager at Old Mutual Asset Managers.
Grace, investment grade portfolio manager, joined Artemis in December 2019 from Aegon, where she was a co-manager in a range of investment grade bond funds.
Liam leads the Artemis fixed income team's strategy on macro and rates. He joined Artemis in November 2023, coming from Standard Life Investments, where he developed his career first as a risk manager in 2010, before moving to the rates team in 2012 and becoming head of UK rates in 2018.
They are supported by two high yield analysts, one credit analyst and two dealers, as part of the wider Artemis Fixed Income team led by Stephen Snowden.
Investment Philosophy & Process Overview
The Artemis Strategic Bond fund is an unconstrained strategy with the flexibility to allocate across the entire fixed income spectrum. The portfolio managers take a dynamic approach to portfolio positioning to take advantage of the different stages of the economic cycle. The fund will employ a longer term strategic and thematic approach, investing with a core exposure to corporate investment grade, typically between 30-60%; to high yield corporate bonds, typically between 20-50%; and to government bonds, typically between 10-20%. The managers will also seek short term tactical opportunities to take advantage of market moves.
The managers follow a simple, pragmatic approach, with structural allocations across the sub asset classes broadly unchanged, and looking for the best risk return profile from each asset class at any time. The corporate investment grade and high yield exposure is taken directly in cash bonds, whilst for the rates bucket, the dedicated manager makes extensive use of derivatives to take relative value (long and short) positions across the yield curve and cross country positions. There is no currency risk in the portfolio, all currency risk is hedged back to base currency (GBP).
The three portfolio managers jointly form an asset allocation view to set up the credit and interest rate exposure of the fund. Once the macro view and risk appetite has been established, each of them has the freedom to implement their bottom-up ideas in their respective buckets: Liam in yield curve, cross markets and inflation markets, David in high yield across ratings, sectors with active security selection and relative value trades, and Grace in investment grade corporates across ratings, sectors with active security selection and relative value trades.
Active stock selection plays a fundamental role of the strategy and investment process. Individual stock selection is critical at all levels of the credit ratings spectrum. Each manager is an expert in their respective segment of the fixed income market and seeks to add value within their allocations. They bring their best ideas to this portfolio, regardless of benchmark weights in their sectors. For example, David Ennett invests across 40-50 high yield issuers for the Strategic Bond, whereas he invests in over 100 issuers in the single-strategy global high yield fund. While the corporate investment grade allocation is more diversified, Grace Le has more flexibility to invest in her best ideas, as within the Strategic Bond fund she does not have to manage the portfolio relative to a benchmark.