OMGI's Watts backs 'esoteric' names in £1bn mid-cap fund

Old Mutual's Richard Watts has taken positions in student accommodation and closed life assurance companies as mid-cap managers continue to ride the housebuilding and construction boom.

The manager of the £1.1bn Old Mutual UK Mid Cap fund, has large positions in housebuilders Barratt (4%), Persimmon (3.7%) and Galliford Try (2.8%). He said while the trend looks set to continue into 2014, his fund had to diversify into more unusual holdings to produce alpha. Watts (pictured) is also expecting to top-slice his largest holding, a 4.4% position in construction rental firm Ashtead – another mid-cap favourite – once it reaches 5%, as its stock price continues to rise. Instead, Watts bought a 2% position in closed life assurer Phoenix Group in April, which consolidates t...