The fund follows a contrarian strategy, whereby the manager looks to find companies that are under-priced relative to their quality. The team invest in stocks where the potential upside is greater than the potential downside, generally because a substantial amount of bad news is already priced in to the stock. The accounting background and experience of the investment team is important to the approach as it allows the team to identify and define the “correct” quality of the company and its fair value.
We like the fund as it offers a differentiated approach that invests in underappreciated companies that many investors miss, and avoids the over saturated stories which have already achieved substantial growth. The approach has resulted in an excellent return profile over time, and the team have shown clear ability in adding outperformance through stock selection.
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Fund Manager: Jonathan Pines
Jonathan Pines has over 15 years’ experience and joined Hermes in 2009. Before joining Hermes, Jonathan was an investment analyst and fund manager at Orbis Advisory and RAB Capital, where he focused on emerging markets. Jonathan is a chartered accountant, a CFA charter holder and holds an MBA from Harvard Business School
Fund Group: Hermes Investment Management
Hermes Fund Managers is a multi-boutique asset manager with £24.9bn in assets under management. Hermes is a unique organisation, as it is owned by (and the principal manager of) the BT Pension Scheme. The business has a growing global presence, supported by their head office in London and regional offices in Boston, New York, Sydney and Singapore. As a boutique asset manager, Hermes is made up of a range of small specialist investment teams and also an equity stewardship business (EOS).