TROJAN FUND I

Investment Process

Fund manager Sebastian Lyon takes both a top down and bottom-up investment approach when selecting holdings for the portfolio. He sets the asset allocation based on his views on the economic environment and how current markets compare with history. That means switching between mainstream assets classes such as cash, fixed interest, gold bullion ETFs and equities depending on relative values and outlook. There are no restrictions on weightings to asset classes, with the approach being truly unconstrained. Lyon then uses a bottom-up process looking at the fundamentals of around 200 companies. These are mainly large-cap stocks based in development markets, with high returns on invested capital that can be sustained because of their long-term competitive advantages. These companies will typically have sound balance sheets, management that acts in shareholders’ best interests and generally attractive yields. In addition, they will have long-term vision, be adaptable and open-minded. In essence the team looks for “high quality at the right price” with equities, supplemented with index-linked government bonds and gold to provide inflation protection and diversification. Lyon assumes overall control of the portfolio and has the ultimate say on composition. Charlotte Yonge predominantly focuses on the equity portion of the fund and has a big input in selection.