Artemis is on high alert over capacity concerns as it prepares for a deluge of new investments into its Income fund following Neil Woodford’s resignation.
Most experts canvassed by Investment Adviser last week tipped Adrian Frost and Adrian Gosden’s £5.9bn Income fund as a default replacement for Mr Woodford’s investors who were looking to move their money.
Artemis said it was aware of the potential influx into the fund and was prepared to manage capacity – in other words, find ways to prevent the vehicle from growing too large to manage effectively.
It is understood the firm will look to protect the fund from an uncontrolled deluge of new investments by maintaining premium pricing on the product compared to its rivals.
Richard Pursglove, head of retail at Artemis, said: “As one aspect of our ability to meet our clients’ objectives, we monitor regularly our funds’ optimum capacity.
“As far as the Artemis Income fund is concerned, we are paying particularly close attention as to how our capacity is utilised.”
The fund grew 34.3 per cent in the year to the end of September 2013 – from £4.4bn to £5.9bn – through a combination of positive investment performance and new money flowing in.
Artemis said it had no plans to ‘soft-close’ the fund or remove it from platforms, but it is understood the firm would consider taking further action to discourage investment if the fund saw unsustainable inflows in the wake of Mr Woodford’s resignation.