Sierra Rutile LTD (SRX)

 

Funds Premier League: Good things come in fours

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UK smaller company funds

Investec UK Smaller Companies

Consistently in the top quartile, the £427 million Investec UK Smaller Companies fund managed by Philip Rodrigs has performed in good times and bad since he took the helm in 2006. Despite the struggling UK economy, Rodrigs remains confident his run can continue, with his ability to make decent returns in difficult markets.

He puts this down to focusing on stock that is cheaply valued, despite high-quality business models. "This approach often means discovering interesting investment opportunities in companies that have been flying under the radar but which are just embarking on a new trend," he says.

Rodrigs looks to identify higher than average quality companies, better than average value, an improving expectation of current profitability and current share price strength. These four factors, if found together, tend to be strong indicators of future company strength.

An example of a top performer that Rodrigs cites is mineral sands producer Sierra Rutile (SRX), which he invested in during late 2009.

Rodrigs doesn’t harbour great ambitions for the revival of global economies in the short term, but he remains confident that many companies can work to find their own reasons to grow, regardless of the economic backdrop.

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Every year Money Observer runs the rule over 11 popular fund sectors from which it picks the Premier League team. Find out which investment vehicles made the cut in: Premier League of Funds delivers super returns.