Our process is designed to produce ‘best ideas’ to enable active fund management within a rigorous control framework. The framework begins by narrowing down the universe of stocks by passing those companies with a market capitalization above £100m through a screening process which highlights the poorest performing stocks. This isolates opportunities with attractive sentiment characteristics which are then in turn scrutinized in greater detail to identify investment opportunities.

The process is very much bottom-up, and can result in large sector positions being taken if enough stocks of sufficient interest are found within one sector. Our portfolio consists of stocks which have been purchased for many different reasons at different times. In general, because of our bottom-up approach to stockpicking, each of these reasons is independent of the other and we are therefore not excessively vulnerable to long-term macro trends. Cash is a residual of the process and normally will not exceed 5% of the portfolio value.