The four Artemis funds within the IMA UK All Companies and UK Equity Income sectors have all failed to beat the FTSE All Share over both time periods, while the Artemis UK Smaller Companies fund has fallen short of its Hoare Govett Smaller Companies (ex ITs) benchmark.
The likes of Artemis UK Special Situations and Artemis Income are former darlings of the industry and topped their respective peer groups during the early 2000s. However, in the last five years they have struggled to maintain the form that saw them develop into multi-billion pound portfolios.
Performance of funds vs benchmarks over 3-yrs
| Name |
1yr (%) |
3yr (%) |
5yr (%) |
10yr (%) |
| Artemis - UK Special Situations |
-3.4 |
72.08 |
11.5 |
129.83 |
| Artemis - Income |
2.11 |
65.41 |
11.24 |
101.62 |
| Artemis - UK Growth |
1.44 |
81.94 |
3.3 |
77.41 |
| Artemis - Capital |
-6.51 |
60.89 |
-19.22 |
28.8 |
| FTSE All Share |
0.38 |
86.45 |
12.53 |
65.86 |
| Artemis UK Smaller Companies |
4.27 |
107.92 |
-2.98 |
117.47 |
| HGSC (ex ITs) |
0.15 |
126.95 |
14.11 |
150 |
Source: FE Analytics
While Artemis also runs European, Global and mixed-asset funds, the bulk of the group’s assets are in the UK equity range. According to FE data, £6.02bn of its £8.47bn assets under management (AUM) are invested in these five funds.
Adrian Frost’s £4bn Artemis Income fund has had a particularly disappointing run, underperforming its benchmark by more than 15 per cent over a three-year period and 1.29 per cent over five years. With a one-year historic yield of 4.58 per cent the fund is, however, yielding more than the All Share.
Philip Wolstencroft’s £305.3m Artemis Capital portfolio has the worst record overall, losing 19.22 per cent over a five-year period and underperforming by more than 20 per cent over three years. The portfolio uses SmartGARP – a computerised quant model designed by the manager, which helps with stock selection.
Performance of funds vs indices over 3-yrs
Source: FE Analytics
The Artemis UK Smaller Companies fund had a golden era under John Dodd in the late 1990s and early 2000s, but again it has fallen down in the last five years or so. Since Mark Niznik took over from Dodd in October 2007, the portfolio has lost 10.57 per cent, compared with gains of 15.55 per cent from its Hoare Govett Smaller Companies (ex ITs) benchmark. It also falls down over three and five years.
While Ross Leckie, director of communications at Artemis, acknowledges the recent underperformance of the firm's flagship UK equity funds, he says he has every faith in the managers to turn around performance and maintain a strong long-term track record.
"Even though some of them have suffered periods of poor performance in the volatility since 2008, the long-term record of all our funds remains strong," he said.
"The medium-term has been very disappointing, no doubt about it. We don’t try and talk our way out of underperformance, but instead look to how we can improve."
The stellar long-term record of Frost, Niznik and Adrian Gosden is why the managers have retained their FE Alpha Manager status. According to FE data, the Artemis Income fund is the sixth-best performing UK Equity Income fund of the last 10 years, with returns of 101.62 per cent.
As manager of the Standard Life UK Opportunities fund between November 2002 and April 2007, Niznik was a top-quartile performer, delivering in excess of 210 per cent.