JohnBaronPortfolios.co.uk

OCI is a private equity investment trust managed by Oakley Capital. The trust aims to deliver long-term capital appreciation by investing in middle-market companies across Western Europe, focusing on sectors such as technology, consumer, and education. Known for its hands-on investment approach, Oakley Capital Investments partners with dynamic, high-growth businesses, often supporting them with strategic guidance and operational improvements. In this interview we speak to Oakley Capital partner Steven Tredget about how the company’s founder led approach is a key advantage in finding deals at attractive valuations; the key megatrends it targets including the digitisation of consumer and business services; how its direct ownership and hands on, consultancy led approach has consistently delivered above average investment returns; the growing importance of private equity to the UK economy, and why investors should look past pervasive and often unjustified private equity myths to gain exposure to the asset class.

HSL focuses on achieving long-term capital growth by investing predominantly in UK smaller companies. Established in 1887, the trust aims to outperform the Numis Smaller Companies Index (excluding Investment Companies). Its diversified portfolio includes a wide range of sectors, targeting companies with robust growth potential. The trust has delivered consistent performance, often exceeding its benchmark, driven by a disciplined investment approach and strong stock selection, and despite its growth mandate was awarded the AIC’s Dividend Hero status after delivering 20 years of uninterrupted dividend growth. In this interview we speak to manager Neil Hermon about HSL’s bottom-up research process, and why it’s important not to overpay for growth prospects; how the company has navigated an extended small cap market downturn, and why recent weakness has been more cyclical than structural; the wealth of niche opportunities offered by the UK small cap market; the ‘four Ms’ that guide the company’s investment approach – Model, Management, Money, and Momentum; and the overlaps between growth, value and dividend investing.

JARA is an investment company whose aim is to provide shareholders with stable income and capital appreciation from a globally diversified portfolio of core real assets. These include a mixture of real estate assets and infrastructure such as transport and energy, held via equity and predominately debt investments. The company sits within the AIC’s Flexible Investment sector. In this interview we speak to manager Philip Waller about JARA's role as a diversified, foundational allocation in investor portfolios, emphasizing stability, predictability, and income generation; the strategic asset allocation process, global diversification, and the management of the trust to meet objectives amidst changing market conditions, including shifts in interest rates and economic landscapes; the active management approach to optimize returns and mitigate risks; and the manager’s attitude to the wide discount to NAV at which the shares currently trade.

HVPE is a FTSE 250-listed investment company offering investors exposure to a portfolio of private companies, in effect opening access to what has been an opaque and difficult to access asset class. It offers exposure to more than 1000 private companies on a global basis across a range of sectors and asset types, with 30% of its portfolio in venture and growth equity. Its aim is to provide steady annual NAV returns, with 10-year net NAV growth of 14%, far outstripping the 5% CAGR offered by the FTSE All World index. In this interview we talk to manager Richard Hickman about how diversification across the private equity spectrum helps deliver consistently above average performance; the rationale behind high weightings to tech, consumer services and healthcare, and how the returns on more traditional sectors are benefitting from the application of technology; the growth of private equity into a self-sustaining ecosystem and the weakening ‘pull factor’ of public markets; reasons for the large discounts on PE trusts, and the impact of a recent lull in the IPO market; and the rationale behind the creation of a shareholder distribution pool.

MYI is a high-conviction portfolio that invests principally across global equity markets with the option to introduce fixed income instruments. Its aim is to deliver an above average dividend yield alongside dividend and capital growth ahead of inflation. The near 120-year-old trust is run by a trio of managers, Bruce Stout, Martin Connaghan and Samantha Fitzpatrick, with Mr Stout set to retire this summer.  In this interview we talk to co-manager Samantha Fitzpatrick about the impact of inflation on the trust’s ability to deliver on its income growth objective; the advantages of the company’s free ranging global remit, and why it’s currently overweight in emerging markets; the importance of capital preservation in the strategy and why the managers are happy to accept the ‘defensive’ label; using ESG analysis as a risk management tool; and why a potentially new interest rate paradigm is unlikely to bring a change to the managers’ approach.

Launched in 1891, CTY is one of London’s oldest investment companies, with a track record of 57 consecutive years of dividend increases, the longest of any company. The company aims to deliver both income and long-term capital growth by investing in a portfolio of mostly UK equities but with the ability to hold a fifth of the portfolio in overseas stocks. The company has been managed by Job Curtis since 1991. In this interview we speak to Mr Curtis about the experience he’s gained through managing the company through various market cycles; the impact of the recent shift in the inflation and interest rate environment; the investment process behind the trust and why valuation is the starting point for investment selection; the current attraction of financials as the highest sector weighting in the portfolio; the pragmatic approach the trust takes to ESG and the energy transition; and why talk of the UK’s stock market demise has been greatly exaggerated.

SCF seeks to deliver income growth ahead of inflation by way of rising dividends, as well as capital growth – an objective it has achieved for 28 consecutive years. The company invests across the UK market cap and growth/value spectrum. In this interview we speak to manager Sue Noffke, who has been lead-manager since 2011, about how the company has changed tack through the recent inflation spike; how its flexible size and style mandate has helped it navigate recent challenges; the outlook for key holdings including Shell, AstraZeneca and GSK; and what the UK market needs to do to overcome its long malaise.

LABS is a real estate investment trust focused on delivering strong total returns from a portfolio of properties leased to tenants operating in the UK life science sector. The company buys and develops properties specifically in the so-called Golden Triangle of Oxford, Cambridge, and King’s Cross in London - the beating heart of the UK’s world-leading life science industries. In this interview we speak to manager Simon Farnsworth about the advantages of having a specialist focus in real estate; how the specific demands of life science tenants create greater opportunity to unlock value through asset management of its estate; how the company balances acquisition and development in regions facing extreme planning challenges; and why government support for UK life sciences and the proximity to leading academic institutions in its target regions is creating a long-term tailwind.

HFEL is an investment company that seeks to deliver a growing dividend for its shareholders along with capital growth from a portfolio of around 60 companies across the Asia Pacific region. The company targets high and sustainable dividends from companies in the region’s more mature markets such as Australia and South Korea, and those in its faster growing economies that have a higher potential for dividend growth, including India and Indonesia. In this interview John speaks with manager Sat Duhra – who co-manages the company alongside Mike Kerley, until the latter shortly retires – about how the trust has navigated a difficult year for Asian equities; why the team have reduced exposure to China in favour of India; the growing technological capabilities of Asian companies, and the increasing penetration of Asian brands into global markets; and the attractiveness of Asian equity valuations in the context of their rapid growth prospects and growing economic resilience.

EDIN appears on the Podcast page for the second time to coincide with a change of the company’s management this month. Retiring lead portfolio manager James de Uphaugh will be succeeded by Imran Sattar, currently deputy portfolio manager, while long-standing Liontrust fund manager Emily Barnard will become deputy portfolio manager. In this interview John speaks with Imran Sattar and Liontrust Head of Investment Companies James Mowat about how the robust processes employed to manage the trust brings continuity alongside the change of managers; how the company’s flexible mandate and focus on stock selection has allowed it to achieve its primary objective of growing its dividend at a faster rate than inflation; the catalysts for improvement in some out of favour holdings that have proved significant contributors to performance; and details of the thematic framework used to evaluate investment opportunities.