Ben Whitmore has recently taken over management of the Jupiter Income Fund. The fund has been handed over from Tony Nutt, who managed the fund since 2000 and will retire from Jupiter in 2014. We recently met Ben Whitmore to discuss planned changes for the portfolio.
Following a period of lacklustre performance, it is clear Ben Whitmore is concentrated on restoring the fund to health and aims to get performance back on track as soon as possible. There will be no changes to the underlying objective of the fund and, similar to Tony Nutt, Ben Whitmore is a contrarian investor. This means he seeks out of favour companies whose share prices he believes are under-priced, despite them being well-run and having sound balance sheets.
Ben Whitmore has already begun making some changes to the portfolio. He feels many equity income funds are too similar, with a tendency for their income to be derived from a concentrated number of stocks. The manager does not favour this approach, believing it wise to diversify the fund's sources of income.
Ben Whitmore also intends to make more use of his flexibility to invest overseas, where up to 20% of the fund can be invested. He will only do so upon identifying compelling opportunities and believes this will aid in diversifying the fund's income stream.
The fund has also seen a reduction in its exposure to smaller companies. Smaller companies have recently only represented a small part of the portfolio, but Ben Whitmore will reduce these positions further, believing his talents lie in identifying successful larger and medium sized companies.
The Jupiter Income Fund shares similarities with Jupiter UK Special Situations, a fund Ben Whitmore has managed for over six years. This should aid him in his transition as he already knows many of the existing holdings in the Income Fund extremely well. Although the main objective of Jupiter UK Special Situations is to focus on capital growth rather than income, the manager has a bias towards stocks that pay dividends, which he believes plays an important part in overall total returns.
Ben Whitmore has built a good track record since managing the Jupiter UK Special Situations Fund. It is encouraging he also has previous experience of managing income portfolios and his investment style means he naturally favours dividend-paying companies. We believe investors in the fund should continue to hold providing it continues to meet their objectives. Currently, the fund does not feature on the Wealth 150 list of our favourite funds across the major sectors, but we will continue to monitor the manager's progress.