Fund of the Fortnight: Majedie UK Equity
The latest: Majedie UK Equity
Majedie UK Equity is the flagship fund of Majedie Asset Management, an investment boutique based in London next to the Old Bailey. Founded in 2002 by a group of former Merrill Lynch fund managers, the company now has £10bn under management.
The bulk of this is in the UK Equity strategy, but Majedie also has a UK Focus and a fast-growing UK Income fund, as well as the long/short Tortoise fund. It is currently establishing a global equity offering, having recently hired Tom Record from Baillie Gifford.
The UK Equity fund was launched by four fund managers, James de Uphaugh, Chris Field, Adam Parker and Rob Harris, who previously formed Merrill Lynch’s Alpha Team. The first three of these remain in place, but former Deutsche Bank man Matthew Smith succeeded Harris on the fund in 2010. Harris remains with Majedie – he is the company’s chief executive officer and manages investment communications.
The fund has an unusual structure in that it is split into four separate sub-portfolios. Though the managers sit and work together, they pick stocks and form their portfolios separately and have different styles.
Field, Smith and de Uphaugh run focused portfolios of FTSE 100 and FTSE 250 stocks each making up 30% of the fund. The other 10% is run by Parker alongside recent hire Richard Staveley, formerly of River & Mercantile – the duo specialise in small cap stocks.
Put together, the sub-portfolios combine into a very diverse fund with over 240 stocks, though it is more concentrated than this headline figure suggests with around 90% of the portfolio in the top 60 holdings. The fund includes companies of all sizes, but around 75% of the fund by value is in FTSE 100 stocks and overseas stocks of similar size.
Though unusual, the “mini multi-manager” structure has proven successful over a long period of time – it has performed in both rising and falling markets and has typically been less volatile than the FTSE All-Share benchmark. With over £7bn under management the strategy is not small, but it is currently open to new investment and Majedie has been proactive in limiting capacity on its funds generally in order to maintain performance.
Following a strong run many view smaller and medium sized companies as overvalued, so this might be a particularly good time to choose a fund with a larger cap focus. Majedie UK Equity has a long track record of performance, a proven process and a stable team, making it a good choice to form the core of a UK equity portfolio.
Tom White is senior research analyst at Bestinvest
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