In our latest clip, Imran Sattar, Portfolio Manager of Edinburgh Investment Trust, talks through the strength of the UK PLC balance sheet and the positive position of UK equities in the current market environment.
I talked about our flexible approach. And that's why we look at a wide range of opportunities; growth, value, cyclicals, defensive businesses, self-help stories. Now that said, over the medium to long-term, high-return companies with an economic moat are best positioned to deliver attractive returns. And just as a reminder, what we mean by an economic moat, is how a company can maintain its structural advantage. If you've got high returns and an attractive business, there will be capital that tries to compete against you. And so therefore, having some sort of barrier around your business is your best chance of protecting those returns. So we spend a lot of time thinking about the economic moat of a business. It's important, that said, to be pragmatic. And we find interesting investment opportunities across the spectrum. Some will be growth companies with an economic moat, others will be deep value companies. Moving to the right, portfolio construction plays an incredibly important role in how we run the Trust. And for us that means a number of things. Firstly, it's about ensuring the portfolio is economically diversified and thematically diversified. It also means thinking about macro considerations because companies don't operate in a vacuum. And for us, we think about 'macro from the micro' being the principal way about how we learn about what's going on at the macro level. And what I mean by that is, we tend to meet lots and lots of companies and they're very close to the ground so they know what's on and we build a picture. It's almost like building a jigsaw puzzle to work out what's going on in the economy. Careful risk management guardrails are in place, and that comes from a number of things. Firstly, it's my experience of looking after portfolios for nearly three decades. It's quite scary when you say it that way. Secondly, it is about that portfolio team debate and challenge. Thirdly, it's from the risk team internally at Liontrust. And finally, and this is an advantage of the investment trust structure, it's the board oversight that we have that also looks at risk. And then finally, valuation. It's an important part of the process, but it deliberately comes at the end of the investing process, not the beginning.
KEY RISKS
Past performance does not predict future returns. You may get back less than you originally invested.
We recommend this fund is held long term (minimum period of 5 years). We recommend that you hold this fund as part of a diversified portfolio of investments
The Edinburgh Investment Trust managed by the Liontrust Global Fundamental team may be exposed to the following risks:
- The Net Asset value (NAV) return of The Company corresponds directly to The performance of The securities in which it invests and The income from them. The share price, which will determine The return to The investor, will also be affected by supply and demand. Consequently, The return to The investor may be higher or lower than The underlying NAV return.
- The use of borrowings may increase the volatility of the NAV and may reduce returns when asset values fall.
- The product may invest in smaller companies which may result in a higher level of risk than a product that invests in larger companies. Securities of smaller companies may be subject to abrupt price movements and may be less liquid, which may mean they are not easy to buy or sell.
- The product may use derivatives for efficient portfolio management which may result in increased volatility in the NAV.
The issue of units/shares in Liontrust Funds may be subject to an initial charge, which will have an impact on the realisable value of the investment, particularly in the short term. Investments should always be considered as long term.
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It should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Examples of stocks are provided for general information only to demonstrate our investment philosophy. The investment being promoted is for units in a fund, not directly in the underlying assets.
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Imran Sattar
Imran Sattar heads the Global Fundamental team. He joined Liontrust in April 2022 as part of the acquisition of Majedie Asset Management, where he had managed funds for four years. Before joining Majedie in 2018, Imran was a Managing Director and fund manager at BlackRock, where he managed UK equity funds with combined assets of over £2 billion.
He holds a BSc in Mathematics & Economics from the University of Warwick and is a CFA Charterholder.