Reducing the risk of investing in zeros

Fund manager Alistair Mundy made a name for himself in February last year with a massive programme trade to reduce risk in his £59m Investec Capital Acummulator fund, which invests in zero dividend shares of split-capital investment trusts. The trade, in which he sold out of 28 stocks, cost the fund 200 basis points in performance terms. Since then, the performance differential between Investec Capital Accumulator and its main competitor funds has been marked. Mundy made the move in response to his belief that zeros with a cross-shareholding of more than 10% in other split-capital inves...