Fidelity Growth & Income fund manager John Stavis has reduced the number of holdings in the portfoli...
Fidelity Growth & Income fund manager John Stavis has reduced the number of holdings in the portfolio from 112 to 81.
Since taking over management of the fund on 14 October, Stavis has trimmed down the tail of the £140m portfolio and is selling companies where he deems the outlook to be less favourable.
Initially Sanjeev Shah was to replace Fidelity's previous Growth & Income manager, Fredric Gautier, who was moved to cover pan-European funds at the group. However, when Glen Pratt, manager of the Fidelity UK Aggressive fund, departed for Newton late last year, it was decided that Shah would be a better fit as Pratt's replacement.
Stavis joined Fidelity in 1995 as an investment analyst and his previous role, prior to Growth & Income fund, was as assistant manager on Anthony Bolton's Special Situations fund.
Julia Edwards, fund analyst at Fidelity, said the rationale behind the reduction in holdings is to run Growth & Income as a more concentrated and actively managed portfolio. Stavis has also increased exposure to mid caps.
The aim of the fund, to achieve a combination of income and capital growth from a portfolio made up of mainly UK companies, will remain largely unchanged.
In terms of Stavis' investment criteria, there are three key areas. The first is high yield, with the manager looking for a yield that exceeds the market. Because he looks for a high yield that is sustainable and able to grow, he is typically looking for mature businesses with good cashflow.
'He is also looking for companies with strong earnings growth and recovery stories, where stocks have been downgraded by the market,' Edwards said.
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