Skandia Investment Management has defended the 10 underlying managers in its UK Best Ideas fund despite its recent underperformance.
In the 12 months to February 4, the £240m Skandia IM UK Best Ideas fund fell by 11.95% against a sector average fall of 6.75% and a 2.82% drop in the FTSE All-Share, according to Morningstar.
Ryan Hughes, fund manager at Skandia IM, says: “The managers have five-year mandates so they invest in stocks that will deliver long-term value.
“At the moment, 50% of the portfolio is in large caps and 50% in small and mid caps, with the latter being badly hit during the volatility of the past few months.
“Good companies have been sold along with poor quality stocks.”
Hughes denies there is insufficient diversification. “Only 11 out of the 100 stocks are held by more than one manager. Only one stock is held by three managers.”