Gil Knight, fund manager of the Govett US Opportunities fund, has taken over management of Govett's ...
Gil Knight, fund manager of the Govett US Opportunities fund, has taken over management of Govett's offshore North American equity fund, GSIL US Growth.
Knight's onshore portfolio is ranked second of 89 funds, seventh out of 80 funds and third of 75 funds in the Autif North American funds sector over three months, one year and three years respectively.
Manager of the onshore fund since its launch in July 1998, Knight has been running it from his office in Baltimore in the US. His three years figures to 6 November show that he returned 90.2% on an offer to bid basis, compared with a sector average of 14.4%.
He will run the GSIL US Growth fund using a multi-cap approach aiming to achieve long-term growth through investment in all economic sectors. Under his control, Knight will bring the management of the $9m fund into closer alignment with the £42.6m onshore fund.
The current focus of the portfolio is on selected defence companies, set to benefit from greater US military spending, healthcare, driven by the continuing demographic shift, and selected consumer discretionary spending shares, such as Walmart, Comcast and the Lone Star Steakhouse. This last group remains attractive because, Knight said, the US consumer will continue to spend for entertainment.
Knight is, however, looking to further shift up his weighting in US smaller companies as they have been sold down and are on attractive valuations, although he believes now is not the time to make the switch.
Currently, in the onshore fund, Knight has more than 40% in companies with a market capitalisation in excess of $5bn. A further 20% is in companies with market capitalisations of between $3bn and $5bn.
He said: 'Going forwards, we think that when we start coming out of this recession, we want to lower the market capitalisation of this fund. The biggest returns will come from that area. Historically that has always happened following a market crash.'
He said the key will be the levels of inventory. When they fall below a certain level, orders will begin to reappear. But anyone who has not invested risks missing what Knight believes could be a rapid market rise. He said: 'My bet is that you will see a pick up in ordering around next April, May and June. The market should discount that five or six months early.'
Ultimately, though, Knight is positive on the US. For the Fed's monetary stimulus not to win out would be a significant new occurrence in US economic history.
The minimum lump sum investment in the offshore fund is $4,000. The initial charge on is 5.5% and there is an annual management fee of 1.5%. Intermediaries can contact Govett's sales team on 0800 015 1646.
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