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New investment boutique Matterley has ambitions to become the next Artemis or BlackRock, but then which new boutique doesn't? One thing is for sure: if it is to successfully compete in this cut-throat space, it will need to fully embody its philosophy of clear communication, a facet it has arguably struggled with in its founding stages.

Launched in June, the company has already introduced its first Oeic, the S&W Undervalued Returns fund. Initially Matterley's chairman and founder, Ian Dighe, said he had secured "from a standing start" £3m assets under management, seeded by the company's six partners. He later said this funding accounted for roughly £1m from contributions from friends and family, which had ultimately been slow to transfer in.

Henry Flockhart, an analyst at Matterley, said the fund's initial assets under management were £320,000. Mr Dighe reiterated that by September, AUM was £1.2m. A third-party contract due to complete in coming weeks is expected to bring a further £4m under management, bringing total AUM to £5.2m.

The September fund factsheet for the Oeic mistakenly listed the IMA sector as "UK All Equity" rather than UK All Companies. Mr Dighe offered "humble apologies" for the inaccuracy, which he says has now been corrected.

This is the first fund launched by Matterley, ahead of its proposed introduction of a 130/30 fund and a private equity strategy focusing on non-bank financials, all of which would be managed by two of the six partners, Henry Dixon, formerly of New Star, and George Godber, formerly of Credit Suisse.

Having former fund managers from such household names as New Star and Credit Suisse on board will doubtlessly boost the confidence of potential investors. However, the chief investment officer at New Star, Gregor Logan, disputes Mr Dixon's initial statement to have been "co-fund manager" of a fund called "UK Institutional Portfolio ", stating instead that "assistant to Tim Bray" would be a more appropriate title. He adds that Mr Dixon worked on the US institutional business investing in the UK, which was part of bigger portfolios.

Mr Logan confirms Mr Dixon was lead manager of £6.98m British Lion, a small sub-fund of a New Star Sicav, and managed Family Charities Ethical unit trust, although this fund is not distributed by New Star. The British Lion trust has remained in the fourth quartile over three years.

Mr Dixon says he is "quite surprised" by Mr Logan's statements and adds: "I don’t think that at any stage I was misleading anyone. I was a co-manager, assistant manager, whatever you call it, on a portion of the institutional portfolio for US clients. Perhaps I am being too blasé, but I worked incredibly closely with Tim Bray for the year on the institutional fund. At no point did I say I was lead fund manager, so I didn’t see that being an issue."

Mr Dighe says that this description was only printed in the first batch of publicity material and has since been reprinted. "We definitely don’t want to mislead people and that is clearly not our intention," he says.

The S&W Undervalued Returns fund has returned a loss of 22.5 per cent to date, compared with a fall of 20.8 per cent in its benchmark, the FTSE All-Share index, according to Mr Flockhart. Mr Dighe was less precise about the fund's performance: "I have not been watching it too closely. I think we’re steady as she goes."

With inflation presently at 5.2 per cent, more than 3 per cent above target, how realistic is the fund's capital preservation approach, which means producing a return at least equal to inflation?

Mr Dighe responds: "I think it forces you to have a focused investment thesis because if you are not genuinely buying undervalued assets, it’s the Warren Buffet quote, isn’t it – the man with no swimming trunks will be caught when the tide goes out. Therefore, your product has to stand the test of time. If it doesn’t work, they want to see mechanisms of getting their money back and in open-ended vehicles there is a free sanction in terms of redemptions."

Mr Dighe says Matterley is distinguished by scrutinising balance sheets, not getting fixated on profit and loss and future earnings forecasts, "looking not at the froth of a P&L account". Is this a revolutionary approach, though? He says: "We suspect that a lot of managers do it in part or whole but in a way, investors want it on the tin, don’t they? They want a commitment that their money is going to be run in a certain way."

Mr Dighe had discussed imminent plans of launching a hedge fund but the widespread outflows, and tales of forced selling emanating from fund management houses, have stifled this plan. He says he "shares the nervousness" of investors, concerned hedge funds have failed to deliver as promised in all weathers.

"We share that nervousness. Recruiting managers who have no scar tissue of managing a focused portfolio through difficult times needs massive stress testing and is another reason for delaying any launch into early next year," he says.

Mr Dighe's previous position was founder of Bridgewell, a mid-market stockbroker. It was sold to Icelandic bank Landsbanki in 2007 for 15 pence less than its Aim flotation price. The transfer followed Bridgewell's two profit warnings within six months of its flotation and the subsequent sacking of its chief executive last January.

He says: "It is what it is. They are notoriously difficult businesses to run. We were beginning to see the tumultuous effect on small to mid-cap brokers in that marketplace and I do not think we were any different from anybody else operating in that space."

The other partners, who have all invested in the Oeic, are John C Head III, who splits his time between Matterley in the UK and private investment company Head & Co in New York; Robert Ware, who acts as silent partner and runs Aim-listed property trading and development company Conygar Investments; and Jonathan Cudlipp, who is chief operating officer and chief financial officer for Matterley. He is a trained accountant and has been directly involved in hedge fund valuations. Mr Godber was a director of equities at Credit Suisse.