Fund of fund managers looking for returns from the US market are favouring Bill Miller's offshore Le...
Fund of fund managers looking for returns from the US market are favouring Bill Miller's offshore Legg Mason Value Trust as one of their core exposures to the market.
Lee Gardhouse, fund of funds manager at Hargreaves Lansdown, says Miller's Dublin-based fund, which was recently launched to the onshore retail market, has proved consistent in its ability to outperform.
Miller and his team are more willing than many managers to spend time analysing the companies in which they entrust their money by working out the true value of the business, Gardhouse notes.
Other favoured US fund picks from Gardhouse are Fidelity American, managed by Fergus Shiel, and James Abate's offshore GAM US Focus fund.
Gardhouse says he used to invest in Fidelity American when John Muresianu, who left the group last summer, managed it. He says it is one of the few US funds in which investors get proper active management across all market caps and across all investment styles, growth or value.
Gardhouse adds: 'All the managers on these three funds are free thinkers. Abate's fund incorporates the market's historical performance and he uses professors in specialist areas and incorporates their ideas into the fund. However, while he approaches the market from a more academic perspective, he still goes out and meets companies and understands their business.'
The three funds Mark Harris, fund of funds manager at Edinburgh Portfolio, thinks are in for a good year are all mainly large-cap focused
Harris is another holder of Miller's offshore fund. He says Miller and his team look at asset price factors such as those that drive stock returns and use a multi-variety approach, which he says is one of the more demanding he has seen.
Harris has also just purchased the Close Finsbury North American fund after it appointed the New York-based Vontobel Asset Management as investment adviser to the fund with Ed Wolczak as its manager.
He says Wolczak focuses on a valuation criteria, similar to those used by Warren Buffet, ie the creation of economic value, quality and sustainability of earnings and the price paid for this.
This price and research intensive approach is one Harris likes, as while it looks for a return on equity, it does not overpay for the companies it holds.
Finally Harris likes the Lord Abbett US Affiliated fund due to its focus on value criteria. He says it is very research focused on the relative valuation of stocks rather than being a deep-value fund.
Harris says: 'All our managers are based in the US. The level of resources, technical ability and the way they think about stock price drivers is very much more advanced in the US than it is in the UK.'
Bambos Hambi, head of portfolio services at Rothschild Asset management, picks out the value-orientated, small-cap biased Findlay Park US Smaller Companies fund as one of his top North American funds.
He says the fund has a highly experienced team and he has known James Findlay for 16 years and over the years this fund has served him very well.
Returns can be made in the US market.
Free-thinking active managers popular.
Managers going back to fundamentals.
Growth in the US will be slow.
Threat of war with Iraq
Few US funds offer active management.
Set up Vanguard in 1975
‘In the know’
Owen to pay £3m
Lasting power of attorney