Bestinvest says
Manager Ben Wallace has a successful track record going back to 2005 on this fund and on a hedge fund with a similar mandate. He has delivered on the objective of positive returns in all conditions fairly consistently, even making money during 2008 by shorting the market ahead of its collapse. The fund reached capacity in November 2011, as a consequence initial charge discounts were removed.
The manager’s process is bottom-up, with the fund investing predominantly in large and mid sized companies. The fund is made up of a blend of tactical positions, which are typically held for less than 3 months, and core positions which are selected with a longer time horizon.
Tactical positions – the manager looks to take advantage of factors affecting share prices in the short term, such as news announcements, index changes and broker upgrades/downgrades. These typically make up around 2/3 of the portfolio, though this will increase in more volatile markets. The manager applies a 10% stop loss on each individual position.
Core positions – the fund takes long positions in companies expected to generate earnings growth not reflected in their share price. Conversely the manager will short companies whose earnings he expects to disappoint, with poor quality management or which operate in industries with structural weakness.
Long positions are held through direct investment and derivatives, short positions will be held through derivatives only, primarily equity swaps and futures.