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GAM STAR TECHNOLOGY GBP - Fund overview

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Overview of GAM STAR TECHNOLOGY GBP

This fund seeks to achieve long-term capital appreciation by investing globally in a diversified portfolio of technology-related companies. The fund invests primarily in the US reflecting the location of much of the industry, though manager Mark Hawtin typically avoids most of the larger industry names in favour of smaller, faster growing companies. Hawtin first identifies thematic trends in IT, then employs fundamental analysis to pick companies poised to capitalise on them. Due to their nature, specialist funds can be subject to specific sector risks. Investors should ensure they read all relevant information in order to understand the nature of such investments and the specific risks involved.

Standard Initial Charge

5.00% 0.00%

Fund summary

Sector  Technology and Telecoms
Product type  OFFSHORE FUND
Launched  February, 2011
Size  £432m
Yield 0.0%
Charging basis  Income
Dividends paid  31 Aug
Bid price 1,476.45p

Fund Charges

Standard Initial charge 5.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 1.50%
Total expense ratio 1.73%
Reduction in yield (10yr) 1.73%

Bestinvest says


Mark Hawtin has built up an impressive record on this fund since its launch in 2011. He has a proven record in the sector, running a technology long/short fund at GAM and having previously run a technology hedge fund at Marshall Wace. Hawtin and his team carry out proprietary research which should give them a knowledge edge and he demonstrates strong awareness of his stocks and the IT industry generally. He invests across the market cap spectrum, favouring faster growing companies, but also has the flexibility to invest in more mature names if he finds their valuations attractive.

Portfolio

gam star technology gbp asset allocation illustration
Allocation Proportion
Equity 102%
High yield bonds
Quality bonds 0%
Property 0%
Commodities
Hedge
Fund cash -2%
gam star technology gbp equity geographic illustration
Allocation Proportion
UK 1%
Europe 9%
Nth America 79%
Japan 2%
Pacific 6%
Other Equity 3%
gam star technology gbp equity capitalisation illustration
Allocation Proportion
Large Caps 75%
Mid Caps 7%
Small Caps 18%

Investment process


The manager starts by identifying industry themes with multi year growth potential, then looks for stocks that will benefit from these themes. Sector research includes speaking to industry names, such as chief technology officers, to see how technology is being used and how this is changing. The team carry out fundamental analysis using a “traffic light” system based on five factors - competitive advantage, management, pricing power, growth and valuation. The team create their own valuation models using various factors including discounted cash flow - there can be up to six models per company based on different scenarios for its future. The manager looks for at least 50% upside in a stock, but valuation is not the key factor in stock selection. Good management is important - Hawtin won’t invest in companies he considers to be poorly managed, even if he likes their products. In constructing the portfolio he pays little attention to the benchmark, often holding few of the top 10 names which dominate the index. The manager also makes extensive use of technical analysis in timing trades.

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