Cumberland Place sustainable long term returns 24 th November 2015 - - PowerPoint PPT Presentation
Unicorn Investment Approach Investing in the Best of British Companies ethos traditional values - investing to produce Cumberland Place sustainable long term returns 24 th November 2015 investment style consistent application of
ethos – traditional values - investing to produce sustainable long term returns investment style – consistent application of clearly defined investment criteria stock selection – systematic process to identify ‘best’ companies analysis – investment ideas researched in-house valuation – experience backed by detailed financial analysis
Independently owned and managed company established in 2000 Fundamental stock picker Renowned UK mid and small cap companies, AIM & fledgling markets specialist Experienced, committed, and well-resourced investment team with >100 years combined experience Assets under management c. £950m* Managers invest in their own funds Aims to generate consistent long term outperformance - be “the best” rather than “the biggest”
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Source: Unicorn Asset Management 30 October 2015
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Smaller Company Advantage
We prefer smaller companies for their inherent flexibility UK smaller companies attract less broker coverage This creates inefficiencies and investment
All research conducted in-house
Alpha Generation
End Market Identification
Companies exposed to growing end markets Strong niche market
breed” companies in established markets Our sell discipline is usually driven by a change in the end market
Alpha Generation
Competitive Advantage
We prefer companies with a competitive advantage Important to understand why a competitive advantage exists We identify competitive advantage: intellectual property, scale, infrastructure, knowledge of market
Alpha Generation
Disciplined Investment Criteria
We only invest in profitable companies Companies must be dividend paying or have a clear path to doing so We believe the highest quality companies should be able to both fund growth and pay dividends
Source: * Peel Hunt UK Market Valuations 26 October 2015; Excluding loss makers **Unicorn Asset Management, weighted average figures 19 November 2015
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Excluding Oil & Gas, Mining
ethos – traditional values - investing to produce sustainable long term returns investment style – consistent application of clearly defined investment criteria stock selection – systematic process to identify ‘best’ companies analysis – investment ideas researched in-house valuation – experience backed by detailed financial analysis
Genuine Smaller Companies Fund
benchmark
All Companies Profitable at Point of Investment
Strong Thematic Plays
Strong Performance
*Source: Unicorn Asset Management, 30 October 2015. Past performance is not a guide to future performance. The value of investments and the income from them may go down as well as up and investors may not get back the full amount of their original investment.
FTSE MID 250, 6.1% FTSE Small Cap, 57.8% FTSE Fledgling, 4.8% Full, 10.0% AIM, 19.2% Cash, 2.1%
Underlying Investments*
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Broad themes, multi-year time horizon, keeping it fluid: Thematic
UK economic recovery focusing on true small companies US GDP growth; US construction & manufacturing recovery Secular tech growth Dividend strength and quality
General
Selective participation in IPO market Speciality/niche businesses Active in secondary fundraisings Investee companies M&A activity
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UK consumer spending growth hit five-year high in Q2 Rising employment, low inflation and wage growth all contributing to the rise in consumer spending Strong house prices boosting confidence and encouraging falls in the savings ratio Forecasts envisage further near-term falls in savings ratio
0.0 1.0 2.0 3.0 4.0 5.0 6.0 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 UK CPI Weekly earnings growth %
Weekly earnings growth versus CPI
Regular weekly earnings YoY % growth UK CPI
*Source: Bloomberg
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*Source: US Census Bureau data, seasonally adjusted figures
Construction put in place for the 12 months to the end of August up 14% YoY to c. $1.1 trillion Highest construction output for seven years Strongest YoY growth since March 06 Robust growth in residential and non- residential construction
5 10 15 20 0.600 0.700 0.800 0.900 1.000 1.100 1.200 1.300
% change YoY Construction put in place ($' trns)
U.S. construction put in place
Construction put in place ($' trns) % change YoY
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used in horizontal concrete placement
flatness and efficiency of the jobsite
construction
recovery apparent
replacement age
Source: Unicorn Asset Management, 30 October 2015
Market Cap £80m Sector Industrial Engineering Index AIM All Share
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industrial fastenings
domestic appliances etc.
Source: Unicorn Asset Management, 30 October 2015
Market Cap £132m Sector Industrial Engineering Index FTSE Small Cap
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niche electronics
manufacturers
specific and technologically complex
and Nordics.
manufacturing
Optic Systems
Source: Unicorn Asset Management, 30 October 2015
Market Cap £159m Sector Support Services Index FTSE Small Cap
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protection systems for military, security and emergency services
manufacturing liners and tubing for dairy industry
BRIC economies
market
Source: Unicorn Asset Management, 30 October 2015
Market Cap £354m Sector Aerospace & Defense Index FTSE Small Cap
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Source: Unicorn Asset Management, 30 October 2015
logistics and e-fulfilment solutions
“omni-retail” market
business pipeline
driving online sales and “click & collect” services
balance sheet
Market Cap £272m Sector Industrial Transportation Index Full
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This document is an advertisement and not a prospectus. It has been issued by Unicorn Asset Management Limited and constitutes a financial promotion under Section 21 of the Financial Services and Markets Act
accountant or independent financial adviser before considering any investment. Past performance is not a guide to future performance. The value of investments & the income from them may go down as well as up & investors may not get back the full amount of their original investment. Investing in smaller companies, including AIM companies & unlisted companies, can carry greater risks than those usually associated with larger capitalised companies. Any decision to invest in the Unicorn OEICs or the Unicorn AIM VCT Plc. should be made solely by reference to the information, terms and conditions contained in the relevant prospectus and application form. Unicorn Asset Management Limited provides no guarantees, representations or warranties regarding the accuracy of this information. This information should not be construed as an invitation, offer or recommendation to buy or sell investments, shares or securities or to form the basis of a contract to be relied on in any way. If you are interested in any of these funds you should contact your usual financial adviser before making any investment decision. Issued by Unicorn Asset Management Limited, First Floor Office, Preacher’s Court, The Charterhouse, Charterhouse Square, London EC1M 6AU. Authorised & Regulated by the Financial Conduct Authority.