The strategy on the Jupiter Merlin Growth Portfolio is to identify the right fund managers and stick with them, says John Chatfeild-Roberts, head of the group’s independent funds team.John Chatfeild-Roberts, head of the Jupiter independent funds team, says it is people that make the biggest difference when it comes to running funds of funds. As a result, he says, the Jupiter Merlin Growth Portfolio is fund manager-focused, with a lot of time spent choosing the right individuals. “Our fund is very much focused on specific managers,” he says. “There are good times and bad times, and some styles suit some environments and not others. We want people whose style is right for the time and situation, who have a higher conviction and have got the wind behind them.” When choosing fund managers, Chatfeild-Roberts looks at the long term. “We always buy a fund manager with the hope that we can stay with him,” he says. “For example, we have held James Findlay continuously, in various guises, since 1992.” The Growth portfolio, which has £523m in assets under management, currently holds 17 underlying funds, although Chatfeild-Roberts says this is not a targeted number. “17 is a natural outcome rather than a figure we consciously target,” he says. “Within those 17 funds there are probably 1,000 shares. It is a hugely diversified portfolio.” It is this diversification that sits well with what Chatfeild-Roberts calls a “risk averse manner”. “We make the most money we can for people, in the manner that fits within the remit of the portfolio,” he says. “We certainly don’t put it all on red.” According to Chatfeild-Roberts, the way risk is managed depends on how it is defined. “Risk [for us] is like losing money,” he says. “We try to buy things that don’t go down and we like to buy things that are not that expensive. The ability to adapt is also an important part of limiting risk, and Chatfeild-Roberts says the portfolio can and needs to be flexible. “In 2003, at the start of the Iraq war, we needed to move the portfolio from defensive to offensive, “ he says. “We can make significant changes when we need to.” This adaptability is also reflected in the fact that the portfolio does not have a cap bias. “It depends on our view of what’s going to happen next,” he says. “We’ve made a lot of money on funds that are small and mid-cap”. Other lucrative decisions include having exposure to Japan and Europe. “We have a reasonable weighting in Japan,” says Chatfeild-Roberts. “Its outlook continues to be good, and its outcomes have been better than expected. We also have a decent amount of exposure to emerging Europe, in companies that are reasonably inexpensive. In America we have probably more exposure than most – about 15%. This is all in Findlay Park though.” Chatfeild-Roberts and his team have made significant investments in resources and financials. “We have constantly had a reasonable resources play over the past three years,” he says. “Essentially this means exposure to gold, oil and basic materials. We are also overweight in financials, but it is more manager-specific.
The portfolio has had no overt technology exposure since 2000.