TM Lansdowne European Special Situations Class I - Income (GBP)

Avigad has managed this fund for a short period so far, so any investment decision should not be made purely based on short-term performance.

Avigad has managed the Lansdowne European Long Only fund since 2012. Over this time, the fund has performed better than the broader European stock market, as measured by its benchmark the MSCI Europe index . As always, past performance is not a guide to future returns.

Over the longer term, Avigad expects the CRUX fund to share the same level of volatility (its ups and downs) as the market. However, given the focus on what he believes to be strong, well-established businesses, he expects the fund to hold up better than the market when it falls.

The manager believes companies operate in a cycle, similar to the three stages of the lifecycle of humans. These are infancy, adolescence and maturity. In the infancy stage, he aims to identify if the demand for a company's products or services has been misunderstood by other investors. Secondly, later in the cycle as companies transition from adolescence to maturity, he considers the level of supply of products to the market, for example they look at companies that have the potential to recover from over-supplying their products.

In addition to the management team's philosophy, the team monitors four catalysts that could cause an inflection point in the cycle, and how this may impact companies. The four catalysts are: regulation, the cost of capital (how much it costs a business to pay for its operations), technological disruption, and consumer habits (which impacts demand).

Meeting company management is a key part of the investment process. Avigad and his team meet around 300 companies each year and have extensive notes and due diligence on hundreds of companies.

New investments tend to make up a small part of the fund and increase over time as the team builds conviction and due diligence of the firm. This leads to a portfolio of around 20-40 companies. This means each investment can have a significant impact on performance, though this increases risk.

There are some similarities between Avigad and the previous fund manager's investment process. For example, they both place importance on engaging with companies and developing relationships with management over time. Naturally though, there are differences in the way they implement their approach. The previous manager invested in companies of all sizes, while Avigad tends to focus on large and medium-sized businesses. That said, he does have the ability to invest in higher-risk smaller companies.