Spouting Rock Asset Management Debuts Small-Cap Fund

Spouting Rock Asset Management has announced the launch of a small-cap growth mutual fund, which began trading today. The Spouting Rock Small-Cap Growth Fund (“the Fund”) has both institutional (ticker: SRSCX) and advisor (ticker: SRSAX) share classes for which it is seeking to raise $750 Million in assets, at which time the Fund will seek approval for a soft close to new investors.

The Fund’s strategy mirrors that of the 60-stock “focused” sleeve of Spouting Rock Asset Management’s small-cap separately managed accounts (SMA), which launched in September 2017.

“We’re a boutique firm focused on identifying inefficient areas of the market and creating strategies to take advantage of them,” said Andrew Smith, Spouting Rock Asset Management’s chief executive. “Small-cap equity fits neatly within that framework.”

Smith noted that small-cap products tend to grow very large, which in most cases is not in the best interests of the funds’ investors. To avoid the Fund becoming capacity-constrained, Spouting Rock will not target wirehouses, electing instead to focus its asset-raising efforts on RIAs, family offices, and high net-worth individuals.

“Keeping the Fund to a manageable size is a function of putting our clients’ best interests ahead of amping up our fee base,” said Smith. “It’s the right thing to do.”

Spouting Rock’s small-cap team is led by 30-year investment veteran and small-cap CIO James Gowen, who will helm the Fund, along with a three-person team. Gowen joined Spouting Rock in September 2017 after leaving Kalmar Investments, where he served as co-leader of the investment team.

Said Gowen, “I was attracted to Spouting Rock for a host of reasons, but two of them were the deciding factors. One was the robust infrastructure – compliance, legal, distribution – which frees me up to focus on doing what I do best. The second reason is the whole-hearted appreciation for bottom-up stock picking and fundamental analysis. Our structure sets us apart in terms of operational strength and alignment.”

Spouting Rock selects individual stocks and attempts to build a portfolio of Future Compounders, which are companies undergoing demonstrated business improvements that we believe can provide higher compound earnings, growth, and stock price appreciation. Spouting Rock is committed to going name-by-name; gaining a deep understanding of the company operations and management; and evaluating each firm on its own qualities, including its ESG merits, with a goal of risk management for clients.

For more information on Spouting Rock Asset Management, visit http://spoutingrock.us/.

Given the significant differences between separately managed accounts and mutual funds, investors should consider the differences in expenses, tax implications, and the overall objectives between separately managed accounts and mutual funds before investing.

Investing involves risk, including loss of principal. There is no guarantee that the Fund will meet its investment objective. Small-cap investing involves greater risk not associated with investing in more established companies, such as greater price volatility, business risk, less liquidity, and increased competitive threat. Because the Fund does not invest in companies that do not meet its ESG criteria, the Fund may be riskier than other mutual funds that invest in a broader array of securities.

Investors should carefully consider the investment objectives, risks, and charges and expenses of the Fund before investing. The Prospectus contains this and other information about the Fund, and it should be read carefully before investing. Investors may obtain a copy of the Prospectus by calling (844) 834-6478.

Distributed by Unified Financial Securities, LLC.

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Lisa Boyce
Water & Wall Group
646.343.9673
[email protected]