Blue Orbit Asset Management - a new quant-orientated small-cap boutique

New boutique small cap fund manager Blue Orbit Asset Management will make it's quantitative strategy - the Australian Small Caps Systematic Alpha strategy - available to investors at the beginning of September.

Blue Orbit was formed by ex-Industry Funds Management (IFM) portfolio managers Adam Randall and Megan Talmage, and former IFM business development director Julie Andrews.

Randall said he has been planning on launching his own funds management operation for some time and the group has been running the strategy on paper for two years. Based on that paper portfolio he expects to be able to add 7 per cent alpha, with a 4 per cent tracking error.

The boutique manager has estimated the capacity of the strategy at $1 billion.

"What we wanted to do was instead of having 200 clients who we don't know we preferred to have four or five clients who we know really well," Randall said.