Alliance Trust adds active global equity manager to stockpickers

Brings number of stockpickers to nine.

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CT Fitzpatrick of Vulcan Value Partners
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CT Fitzpatrick of Vulcan Value Partners

Alliance Trust’s investment manager Willis Towers Watson has appointed US-based Vulcan Value Partners (VVP) to its "best in class" multi-manager investment strategy.

VVP was established in 2007 by CIO C T Fitzpatrick, who will be the lead portfolio manager for the Alliance Trust account.

The firm, which is an active global equity manager with more than $12bn in assets under management and an investment team of 15, recently reopened capacity for new investors, having been closed since 2015.

The latest appointment brings the number of stockpickers selected for the £2.7bn investment trust to nine, with VVP accounting for 8.5% of the portfolio and set to employ a concentrated, "best ideas" approach when picking stocks.

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Craig Baker, chairman of the Alliance Trust investment committee and global CIO of Willis Towers Watson, said: "Vulcan's appointment will provide the trust with access to another highly skilled active manager and will enhance further the portfolio's diversity and risk control.

"What differentiates Vulcan from other 'value' managers is the team's focus on capital preservation and long-term compounding opportunities. 

"The team focus on finding a small number of very high quality businesses that have the ability to compound in value over the long term, that they would want to own if the share prices ever become discounted. They then take advantage of market volatility for buying opportunities, instead of being a victim of it."

At the end of August, the best 10 to 20 ideas from the nine stock pickers produced a portfolio of around 200 holdings.

In a note, Numis said: "The expectation is for manager turnover to be 10% to 15% pa, equivalent to one change per year, however this is the first change since Willis Towers Watson took over management of the portfolio in April 2017, as the manager has given time for the initial allocations to bed-in."

Alliance Trust is one of the Association of Investment Companies' dividend heroes, with 52 consecutive years of rising dividends.

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