Presentation is loading. Please wait.

Presentation is loading. Please wait.

RATHBONE UNIT TRUST MANAGEMENT LIMITED How does one invest in an era of low rates? Cofunds Economic Forum Carl Stick, 28 th September 2011.

Similar presentations


Presentation on theme: "RATHBONE UNIT TRUST MANAGEMENT LIMITED How does one invest in an era of low rates? Cofunds Economic Forum Carl Stick, 28 th September 2011."— Presentation transcript:

1 RATHBONE UNIT TRUST MANAGEMENT LIMITED How does one invest in an era of low rates? Cofunds Economic Forum Carl Stick, 28 th September 2011

2 RATHBONE UNIT TRUST MANAGEMENT LIMITED Cofunds conference Agenda: What is the problem? What is the solution? A value oriented investment process. Rathbone Income Fund 2

3 RATHBONE UNIT TRUST MANAGEMENT LIMITED What is the problem? Investing consists of exactly one thing: dealing with the future. And because none of us can know the future with certainty, risk is inescapable. The Most Important Thing, Howard Marks, 2011 Low returnsHigh risk 3

4 RATHBONE UNIT TRUST MANAGEMENT LIMITED What is the problem? Where is the value in todays market? Where can one find decent returns without taking on undue risk? How does one save for ones retirement? How does one guarantee an adequate income stream? And when? How does one save for healthcare......Education – university fees? Bears prefer bonds, but with yields so low, there is substantial inflation risk. Does one target sub-investment grade? Commodities? Cash? Property? Equities? 4

5 RATHBONE UNIT TRUST MANAGEMENT LIMITED What is the problem? Question: How does one invest in an era of low rates? Answer: One invests poorly, because the available investment options are themselves often impoverished? – James Grant, Interest Rate Observer, Apr 2005 5

6 RATHBONE UNIT TRUST MANAGEMENT LIMITED What is the solution? A value investment process The Analysis of Risk Good Outcome Bad Outcome Good Process Deserved Success Bad Break Bad Process Dumb Luck Poetic Justice Process is more important than Outcome! 6

7 RATHBONE UNIT TRUST MANAGEMENT LIMITED Place your vote now….. A.Heads B.Tails 7

8 RATHBONE UNIT TRUST MANAGEMENT LIMITED Can we kill the company? What is the solution? A value investment process The Analysis of Risk Volatility, illiquidity, and deviations from a benchmark are not risks. Price Risk Business / Fundamental Riskresulting in loss of capital Financing Risk Benchmark / Career Risk – not a true risk. 8

9 RATHBONE UNIT TRUST MANAGEMENT LIMITED A value oriented investment process Identifying value The crucial importance of a value discipline: if you pay a low enough price for a stock, you build in a margin of safety... 9 Source: Thomson Datastream

10 RATHBONE UNIT TRUST MANAGEMENT LIMITED Rathbone Equity Income as a solution? What can investors expect? Strict adherence to a risk and value oriented investment discipline. Focus on the consistent rather than the spectacular – investment rather than speculation. We do something different. We make positive investment decisions, aggressively overweight or underweight industry sectors, and content to hold strong small and mid-cap positions. Strength of business models, balance sheets, and free cash flow. Sustainable and increasing dividends – this means that our distributions are similarly robust. Stable, committed and long-serving management team. 10

11 RATHBONE UNIT TRUST MANAGEMENT LIMITED The Rathbone Income Fund Performance since January 1 st, 2000. Invesco Perp Income 1 / 52 Invesco Perp High Income 2 / 52 Rathbone Income Inc 3 / 52 SJP UK High Income 4 / 52 Royal Bank of Scot Eqty Inc. 5 / 52 11 Source: Bloomberg Finance, September 2011 Performance data: Financial Express, bid to bid, total return.

12 RATHBONE UNIT TRUST MANAGEMENT LIMITED Authorised and regulated by the Financial Services Authority and a member of the IMA. Rathbone Unit Trust Management Limited : Registered Address 159 New Bond Street, London, W1S 2UD Registered No. 2376568 - A Member of the Rathbone Group IMPORTANT INFORMATION The information contained in this presentation is for use by investment advisers and is not intended for circulation to private clients or the general public Past performance should not be seen as an indication of future performance. The value of investments and the income from them may go down as well as up and you may not get back your original investment. 12


Download ppt "RATHBONE UNIT TRUST MANAGEMENT LIMITED How does one invest in an era of low rates? Cofunds Economic Forum Carl Stick, 28 th September 2011."

Similar presentations


Ads by Google