Despite being headquartered in the United Kingdom, Newton Capital Management
is taking a stab at the 401(k) market. The London-based money manager of $50 billion is betting that Mellon Financial Corp., its corporate parent, will be able to give it a boost in the market.
Mellon Financial sold its U.S. 401(k) recordkeeping business to Affiliated Computer Services (ACS) last year, but retained its 401(k) investment-only business.
Newton's first step in the effort is the launch of the Newton International Equity Fund
, its first mutual fund in the United States.
Already, the new fund has attracted an initial investment of $30 million from the pension fund division and the reserves of a "leading U.S. insurance company," according to Newton officials. The identity of the insurer was not disclosed.
"With Newton’s performance track record in international equities and distinctive investment strategy, we expect the fund to facilitate our entry into the 401(k) market," said Mark Scott
, head of Newton's institutional business, in a statement. A spokesperson for Newton was not immediately available for comment.
The launch of the fund forms part of a broader strategy Newton hopes will draw 30 separate account clients and $4 billion of institutional assets during the firm’s first two years of operation in the US market, he said.
Scott added that the firm is working with third-party distributors and has recently been tapped to provide its EAFE ADR strategy to the wrap account platforms of two US-based investment banks. He did not name the banks.
The Newton International Equity Fund, which invests mainly in countries in Europe, Australasia and the Far East, is run by Paul Butler, investment leader for global equities.
Butler, a 19-year company veteran, chairs Newton’s global equity model group and is a member of the equity strategy group, macro strategy group and Newton’s investment committee.
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