James Henderson: 'Like gamblers, investors should not be greedy nor overly careful'

Manager gives his views on contrarian investing

James Henderson, manager of the Lowland and Henderson Opportunities investment trusts and the Henderson UK Equity Income & Growth fund, tells Lawrence Gosling how he has learnt from the gambling world about probability and the pricing up of risk.

How did you decide on an investment style? I had been Richard Smith's assistant in the late 1980s [then manager of Lowland], and I had seen how he had run it. It had been very successful for Richard in the 1980s and when I took it on in 1990, I went away and tried to think about what had worked. Being an income fund in those days was mildly contrarian. You were always buying things that were out of fashion and that is why they had a high yield. The focus was on cash generation because cash pays dividends and you kept away from things that were in fashion and low yielding. I like to ...