Optimal Fund Management Australia Pty Ltd has forged a strategic partnership with the Burnham Group aimed at supporting its growing absolute return investment business.
The company has also announced a name change to ARCO Investment Management Pty Ltd (ARCO), with immediate effect.
ARCO will continue to be controlled by its co-founders and co-portfolio managers George Colman and Peter Whiting (pictured). The firm’s long-established investment process and management team will continue unchanged as will its focus on delivering strong risk-adjusted returns for investors.
Burnham Group’s CEO Chris Cunningham and Burnham Capital’s chairman Bruce Loveday will join an expanded ARCO Board, with Loveday appointed as chairman.
Burnham Group, a long-standing family office and private investment company, will earn a 30 per cent interest in ARCO (via its investment arm, Burnham Capital) in consideration for providing additional capital to accelerate ARCO’s growth. Burnham has also committed to a significant investment in ARCO’s equity long-short strategy.
ARCO, derived from the Latin word for ‘arch’, was chosen as the new identity for the business to reflect the group’s commitment to delivering absolute return investment strategies to investors with an overarching focus on capital preservation. The ARCO identity will roll out over the next few weeks.
ARCO’s principals George Colman and Peter Whiting have welcomed the Burnham alliance which takes effect immediately: “Our partnership with Burnham further strengthens the quality of our existing investment offering to our clients and, over time, will facilitate our delivery of a broader range of absolute return-oriented investment products to investors,” they say. “We look forward to working with Chris and Bruce, who bring many years of valuable experience in investment management to our business. Above all, our shared commitment is to maximise the resources of this partnership to drive better outcomes for our investors.”
Cunningham says that the Burnham Group is a strong supporter of absolute return investing: “We understand the tangible benefits of an investment approach that recognises that sound fundamental analysis and a focus on capital preservation are the key elements to generating superior returns across any market cycle,” he says. “We identified some time ago that the philosophy and practice of ARCO is wholly aligned with our views, so we are delighted to be partnering with George, Peter and their team to expand ARCO’s business and delivery for its clients.”
ARCO’s aim is to provide investors with consistently positive risk-adjusted returns across all market conditions– that is, harvesting alpha on the upside but also limiting losses on the downside. Since its inception in September 2008, the firm’s flagship Absolute Trust has achieved an average return (net of all fees) of 8.2 per cent per annum, with significantly lower volatility than the broader equity market, and has achieved 80 per cent positive performance months over this same time frame.
