Bestinvest says
Tom Dobell is just the 3rd fund manager in this fund’s 40 year history, and has built a strong record over his tenure. He benefits from a similarly long term time frame to investment - he can buy out of favour companies at low valuations, even if recovery is years away. Close relationships with company management, often aided by M&G’s corporate finance team, place him in a good position to judge which businesses are likely to bounce back. The fund has grown considerably in recent years, but this is not necessarily an issue – Dobell is often buying shares when nobody else wants them, then selling years later into a buoyant market. However, we are monitoring assets under management closely.
The M&G Recovery Fund focuses on troubled companies where a good management team is making concerted efforts to turn the business around. The fund manager seeks opportunities among stocks that are often not widely followed by the investment community at large. Consequently, the portfolio has a larger exposure to medium-sized and smaller companies than its benchmark the FTSE All-Share index.
The fund manager seeks to identify stocks whose share prices have fallen well below their true worth, rendering them good value. He is prepared to take a contrarian view and consider areas that are out of favour among investors. These can include restructuring stories, special situations and the seeking out of hidden value. The fund manager takes a flexible and pragmatic approach to stocks and aims to have a holding period of between three and five years. Company meetings and visits, as well as internal and external research, are used to identify stocks for inclusion in the portfolio. The fund manager consider it important to meet the management of all his holdings personally.