Latitude Investment Management's Freddie Lait has said the boutique would consider adding a long-only global equities fund to its current stable of one – the Latitude Horizon fund – having been handed a tranche of the Witan Investment Trust to manage last year.
Lait, chief investment officer and founder of Latitude IM, who spun the company out of Odey Asset Management in October 2016, told Investment Week the firm may add a global equity fund at some point in the future should the Witan venture be a success.
Latitude added a managed account in April 2018 when Witan invested a small portion of its multi-manager portfolio in Latitude's global equity strategy, part of the absolute return Horizon fund. The portfolio Latitude runs for Witan is a carbon copy of the equity part of the Horizon fund, which accounts for half of the fund's assets.
However, Lait added the firm is currently fully focused on building a track record for its Latitude Horizon fund.
"We are investing back in the business," Lait said. "We will continue to spend the surplus cash that we are generating on building out [Horizon] and making it better and stronger.
"That is very much our focus and if we could build a business that only had one strategy for the next ten years, we would all be delighted."
Lait said the firm is currently "hesitant to try and launch other products", citing studies that suggest "smaller, partner-owned boutiques tend to outperform larger conglomerates" in the asset management business. "We feel [a new fund] would slightly dilute the message and the focus for now," he said.
"I think there are many reasons why that is justifiable, if not necessarily provable. The two main ones for us are focus and alignment," Lait continued.
"So, if we remain focused and do not have a huge product suite, and everyone is incentivised around the performance of the fund, so [that] we are genuinely aligned with the clients, then I think we will end up getting better through-the-cycle returns for our clients."
Lait said landing the Witan account was "a feather in our cap" and he hopes what is currently a "medium-sized" account will eventually turn into a large client over time.
As the Horizon fund approaches its three-year anniversary, Lait speculated Latitude could launch a global equity fund should the Witan venture be a success.
He added: "Our hope is that we become one of [Witan's] proper global managers at some point as and when we have proved ourselves, but that will take a number of years, I imagine. And one day we would envisage maybe having a fund around that global equity team."
Now, though, the focus of the firm is on Horizon.
Despite its peers in the targeted absolute return sector seeing huge outflows - almost £6bn in the 12 months to 30 June according to Investment Association data - Latitude has bucked that trend and grown rapidly.
The fund has almost doubled in size to £124.3m in the year to 31 July, with strong performance that has seen it return 18.4% from inception on 1 November 2016 to 12 August 2019, according to FE data.