Schroder Recovery Z

  • 68.84p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • 83.31p
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 0.75%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 0.92%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 4.80%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 01 July 2020

As the name would suggest, the portfolio invests in recovery or special situations. This leads the manager down a value approach to investing. Targeting unloved stocks that the manager believes have potential highlights the contrarian nature of the portfolio. This style of investing can fall out of favour with the market leading to periods of underperformance.

Fund summary

Sector UK All Companies
Structure UNIT TRUST
Launched August, 2011
Size £734m
Yield 4.80%
Charging basis Income
Dividends paid 15 Jul

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 0.75%
Ongoing charges figure 0.92%

Allocation

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Investment process

The fund's investment objective is to achieve capital growth for investors through investment in companies that have suffered a setback. The fund manager focuses on shares which trade at a relatively low valuation compared to the company's assets or profit growth outlook. These shares tend to carry a high yield (income distributions as a percentage of the share price). However, to achieve a growing level of income, the fund manager invests in shares where he believes the company will be able to continue to pay out a high level of income through growing profits. A typical portfolio holding will therefore have a track record of producing strong returns on capital employed. The portfolio will be reasonably diversified across the UK market.

Manager research

Average monthly relative returns

  • 15/16 -0.07%
  • 16/17 -0.23%
  • 17/18 0.32%
  • 18/19 -0.39%
  • 19/20 -1.55%

Bestinvest MRI

  • 3 years -0.54%
  • 5 years -0.38%
  • Career 0.07%
  • 3 years 7.80%
  • 5 years 10.20%
  • Career 83.70%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Kevin Murphy / Nick Kirrage

Murphy graduated with a BA (Hons) in Economics from Manchester University and is a CFA Charterholder. He joined Schroders in 2000, initially working on the UK fund management desk with emphasis on private bank portfolios before becoming a sector analyst in the Pan-European research team from 2003. He is now a specialist global value manager. Kirrage is also a specialist global value manager. He joined Schroders in 2001, spending a year in institutional marketing before joining Schroder research in December 2002 where he was responsible for analysing a number of UK sectors including transport and metals & mining. He has a Degree in Aeronautical Engineering from Bristol University and is a CFA charterholder.

Track record

Kevin Murphy / Nick Kirrage has 13.9 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.07%. During the worst period of relative performance (from January 2014 - May 2020) there was a decline of 27% relative to the index. The worst absolute loss has been 42%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 84%.

Periods of worst performance

Absolute -42.00% (May 2007 - February 2009)
Relative -27.00% (January 2014 - May 2020)

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

Allocation

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Top 10 holdings

Data accurate as at 31 January 2020

5.0096% Anglo American
4.9926% Royal Bank Of Scotland Group Plc
4.9876% Standard Chartered
4.6397% Bp
4.4904% Barclays Plc
4.0623% Pearson
3.9908% Centrica Plc
3.968% South32 Ltd
3.7782% Tp Icap Plc
3.6764% Morrison(Wm.)Supermarkets
Source: Trustnet

Sector breakdown

Financials 30.00%
Consumer Discretionary 12.00%
Basic Materials 11.00%
Consumer Staples 10.00%
Energy 8.00%
Industrials 7.00%
Health Care 7.00%
Utilities 6.00%
Technology 4.00%
Money Market 3.00%

Portfolio

Due to the income targets of the portfolio, there is a bias to value stocks.

Constraints

No more than 15% is held in any one industry and no more than 4% in any one stock. 1.5-2% is the normal holding with circa 60-100 stocks held.

Key Investor Information - Income

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Key Investor Information - Accumulation

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