This was our first introduction to this strategy and offers investors a slightly different play on the US market. The manager takes a top-down thematic approach alongside a bottom-up company fundamental analysis. The manager explained that his interest in investing started back in the seventies when his father lost all his money, and he was driven to invest better. This started with large cap US, but after reading “Fama and French Efficient Market Theory”, he switched to small cap and value as the best place to invest, and has done so since the nineties.
It is a universe of around 4,000 companies but both small and value have been out of favour so the fund against the S&P 500 has really matched the performance whilst other funds have done well by holding big tech. He believes a switch to value and small cap will benefit the fund. There are some simple rules he follows – he does not want to invest in disrupters or be caught out by disruptors, and he takes a no sin approach (no tobacco, gambling, weapons, and alcohol)….read more