The Manek Growth fund has once again soared to the top of the UK All Companies sector, outperforming its closest competitor by 13.2% over the past three months.
Jayesh Manek, who runs the £40m fund, attributes the outperformance to a defensively positioned portfolio with exposure to utilities and pharmaceuticals as well as index futures.
In the past three months it has returned 24%, ranking it first out of 307 vehicles. The sector average is -3.8%. On a three-year and five-year basis the fund also sits in the top quartile.
However, one-year figures place Manek Growth in the bottom quartile, ranking 266 out of 302 funds.
Manek famously launched the fund after winning a fantasy investment competition in the mid-1990s.
Assets flew into the fund, reaching a peak of £300m in 2000, but investors were left disappointed when performance was badly hit by a large exposure to technology stocks.
Former pharmacist Manek carried out a review of the investment process, boosting performance, but as the figures show, it continues to be erratic.
Manek says towards the end of last year he had a negative outlook on the UK so avoided banks, retailers, housebuilders, miners, and consumer-related sectors.
“I did not participate in sectors that did exceedingly well. Some of the lower quality names did better than more solid companies because of risk appetite increasing. There was some short-term upside but I think long term these sectors will continue to suffer.”
Outperformance this year, he adds, is due to overweight positions in utilities, at 21.2% of the portfolio, and pharmaceuticals, at 8.5%.
Manek also singles out Heritage Oil, Blinkx and Wolfson Microelectronics as positive contributors.
“It has been a combination of the stock selection and the defensive characteristics of the portfolio.
I have maintained a futures position on one of the main indices where, if the market went down, the fund would not suffer as much.”
