Funds to watch 3-yr performance
Threadneedle (Lux) UK Equity is managed by Chris Kinder and holds a Morningstar Analyst Rating of Neutral. Kinder took over the fund in 2014. Although this is his first long-only UK mandate he has a successful track record running an extended alpha fund. Performance here has been similarly strong since he took the reins. His approach is bottom-up focused and the fund sits in the blend style box, showing only a very slight bias to growth at times.
Liontrust GF Special Situations has a UK-domiciled sister fund, Liontrust Special Situations, rated Bronze by Morningstar. The two funds have almost identical holdings but the Ireland-domiciled fund is much smaller at just over $36m. The approach combines two of Liontrusts’ experienced managers, Anthony Cross and Julian Fosh. Cross is a small and mid-cap specialist and Fosh a large-cap specialist.
Jeremy Lang manages the Ardevora UK Equity Fund that was launched in 2011. It uses a process that has been followed by Lang over his investment career and focuses on situations where biases in the behaviour of investors, financial analysts and company managers are likely. The fund is structured as a 150:50 long/short portfolio. It can be reasonably concentrated in terms of number of positions and is benchmarked against the MSCI IMI Index.
Funds to watch Newcomers
Old Mutual UK Alpha (IRL) has a UK-domiciled sister fund that has been managed by the highly experienced Richard Buxton (pictured) since December 2009, and is rated Silver by Morningstar. That fund outperformed its peers and the FTSE All-Share in 2016. However, returns over the shorter term have been weak, with its overweight to financials services and underweight to consumer-defensive sectors combining with some weak stock selection.
Majedie Asset Management UK Equity has a longer-running UK-domiciled sister fund, rated Bronze by Morningstar, which has performed strongly since 2003. The funds are managed in a similar fashion, combining three large-cap sub-portfolios and one small-cap portfolio. Each is managed by a different manager, with a reasonably consistent allocation of 30% to each of the large-cap managers and 10% to the small-cap manager.
Liontrust GF UK Growth is an Ireland-domiciled version of the longer-running Liontrust UK Growth Fund, which is UK-domiciled and holds a Morningstar Analyst Rating of Bronze. The strategy has been managed by Julian Fosh and Anthony Cross since early 2009, using their intangible assets-focused approach. Although this is the most large-cap focused product the pair manages, it still has a significant bias to mid- and small-cap names relative to the FTSE All-Share Index.
Funds to watch Assets under management
Schroder ISF UK Equity is run by Alex Breese and holds a Morningstar Analyst Rating of Neutral. It has only been managed by Breese since mid-2013, when he moved to Schroder from Neptune, where he ran a UK fund. Breese focuses on stocks with value or underappreciated growth characteristics and, ideally, elements of quality. This gives him the flexibility to hold a variety of situations but, in aggregate, there tends to be a slight value bias.
JOHCM UK Growth is an all-cap product managed by Mark Costar. Costar has been at the helm since 2001 and has implemented a value strategy, which is based on finding undervalued companies. He takes a longer-term approach and is happy to have a portfolio that is very different from mainstream indices. The fund holds a Morningstar Analyst Rating of Silver.
Nick Little runs the BGF United Kingdom Fund and its sister UK-domiciled fund, BlackRock UK. He took over managing the fund in October 2013 but has shown overall outperformance of the FTSE All-Share Index and the Morningstar Large-Cap Blend Equity category over his tenure. His approach combines industry views with stock selection, drawing on the UK team of managers/analysts, each of who have sector research responsibilities. The fund holds a Morningstar Analyst Rating of Bronze.
