Ardevora's Lang and Pattison invest extra £2m in own funds

Ardevora's Jeremy Lang and William Pattison have added an extra £2m of their own capital to their funds on a "reasonably bullish" view on equities.

The £2m has been added to the £10m the former Liontrust managers have already invested into the range, with £1.5m going into the Global Equity fund and £500,000 into the UK Equity funds, both of which are long/short portfolios.

Although Lang said he does not see a solution to the eurozone debt crisis imminently, the more important factor and catalyst for equity markets to move forward is policy easing in China.

"We are reasonably bullish on equities now because the US is in pretty good shape and we believe that the Chinese will ease.

"Other risk assets look expensive and with the spectre of inflation casting an ever longer shadow, equities look extremely good value on a longer view."

In October last year, Investment Week reported Lang and the team had begun adding "heavy cyclical" stocks in anticipation of China nearing the bottom of its economic cycle, which would in turn lead to a boost in global growth as monetary policy was eased.

"What is going on in China is a classic economic cycle we have seen in the US or UK on countless occasions," Lang said.

"When everything is going too well, the government slams on the brakes by tightening monetary policy. This hurts for a while as it does its job of slowing down the economy.

"But as soon as growth starts to look worrying, the government will take its feet off the brakes again and stop holding everything back. We are well positioned for policy in China to start easing again."

He added early cycle stocks such as large-cap miners, Japanese equities, and stocks exposed to the US consumer to the global fund.

More recently he said the bad economic news coming out of China has not been viewed negatively by the market as investors have realised China will start to ease, which will be critical to global growth.

Both Ardevora funds have performed well since launch. The UK Equity fund has outperformed its peer group by 9.73% since inception on 11 February 2011 while the Global Equity fund is 7.13% ahead of its sector average since the same launch date, according to Morningstar.