JOHCM UK Opportunities Fund
Fund managers Rachel Reutter and Michael Ulrich, supported by experienced analyst Eoghan Reid, run a concentrated portfolio of best-in-class UK large and mid-cap companies.
They invest in companies with reliable cashflows which they expect and encourage management to invest back into their businesses to sustain future growth. The team conduct their own work on sustainability that goes beyond the box-ticking exercises conducted by rating agencies. They engage with management teams to encourage them to develop transparent and meaningful sustainability goals.
The team view markets as cyclical, inefficient and prone to bouts of irrational behaviour, where capital can be permanently destroyed. They believe that a focus on capital preservation is key to achieving long-term growth. The team look for companies with strong balance sheets and robust accounting, where organic investment is prioritised over ego-boosting and value-destroying acquisitions. They believe sell discipline is an underrated skill and use valuation control to protect clients’ capital.
The team buy companies whose end markets benefit from tailwinds that will enable these firms to grow over long periods. They avoid businesses reliant on an economic cycle or mature markets, where growth can only be achieved through a fight for market share.
The team run a concentrated portfolio and are unconstrained by sector or benchmark weights. This absolute approach to portfolio construction means the portfolio will have no exposure to areas of the market that the fund managers believe will destroy value.
The result is a high conviction portfolio of best-in-class companies with attractive growth and valuation characteristics.