Corporate fund Telstra Super has signed up Legg Mason Asset Management's Australian Small Companies Trust.
It is the first external investor to invest in the fund, which was set up in 1996 as part of Legg Mason's core Australian equities fund.
Telstra Super portfolio manager Dan Farmer said he was impressed with Legg Mason's solid investment process, long-term performance track record and potential for growth thanks to the fact it did not face capacity constraints.
The Legg Mason Australian Small Companies Trust is run by Shane Livingstone and as at January 2007 had generated returns of 14.4 per cent since inception.
This is compared to the benchmark Small Ordinaries Index return of 11.6 per cent.
"Our research and market insights indicate that there are significant opportunities for long-term small companies investors, which can be captured by an experienced investment team," Legg Mason head of distribution Kimon Kouryialas said.
"The primary aim of the Legg Mason Small Companies Trust is to exploit investment opportunities where we have confidence in our research and where the market is focused on near-term noise."
Telstra Super has just under $10 billion under management and 80,000 members.
