Fund Manager’s Diary

Monday Return from long weekend in Toulouse where I drove to see the Millau viaduct, which was impressive. Toulouse is an aviation city and the French media are full of reports about potential losses at Airbus due to the strength of the euro against the dollar. They manufacture the planes across Europe but deliver them in dollars.

The strength of the euro continues to add value in our funds and our zero exposure to the dollar has also been beneficial.

Tuesday Another difficult day for the world equity markets though there is some recovery as the American markets open during the afternoon. British bonds decline, coinciding with our internal publication of a fixed interest research note documenting our view that equities offer better opportunities than bonds. We continue to maintain a short-duration position in fixed interest across all three funds. Our preference for large-cap UK and European equities continues.

Collect children from nursery and engage in the usual bedtime routine. Settle down with a bowl of pasta and my Level 3 CFA [Chartered Financial Analyst] study books.

Wednesday Put the finishing touches to my presentation for our annual client seminar in 10 days’ time. We are expecting 200 people, all of whom are invested in one or more of our funds. It is important to review the year and provide some comment on our expectations for the next 12 months.

Manage to get another couple of hours of CFA study in. Ideally want to complete this book before Christmas so I can have a few days off. It is a hard slog but worth every effort. We already incorporate behavioural finance theory in our approach but this is a useful refresher and a reminder that there is always more to do.

Thursday Constructive internal meeting with our operations team to discuss progress of ISDA [International Swaps and Derivatives Association] agreements with counterparties. These permit us to trade on the OTC [over-the-counter] derivatives market. Also discuss trading ideas that will need operation input shortly.

Continue discussions with Citigroup, one of our trading counterparties, about using put and call options in conjunction with our equity swap positions. Our funds are FSA [Financial Services Authority] authorised and able to invest in derivatives but, as they are one of the few in the marketplace and few precedents have been set, investment ideas and positions need to be carefully worked through.

It is a cold evening but I go to hockey training complete with hat and enjoy a hard session in preparation this weekend’s game.

Friday Daily assessment of liquidity of the funds. We take a three-year view and trade only when better opportunities arise. This long-term strategy has worked well and helps to keep trading costs to a minimum. However, the liquidity position allows us to add Dax future contracts to the Balanced Fund. We like the prospects for German companies, believing the manufacturers will be net beneficiaries of the increasing wealth of Asian nations.

Saturday No hockey match this week, so help a friend to move house.

Sunday The weather is appalling, so enjoy some time with our children and some friends at a local play centre. Another weekend has passed by and still I haven’t done any Christmas shopping.