- Chris St John identifies themes and invests in companies that could benefit
- The fund performed in line with the broader UK stock market over the past year
- We think the manager can deliver strong returns over the long term
The UK is home to some outstanding companies. From those that have been doing business at home and abroad for centuries, to smaller businesses with the potential to be the giants of tomorrow. This provides a rich hunting ground for investors in the UK.
Chris St John, manager of the AXA WF Framlington UK Fund is one of our favourites. He is a proven, well-incentivised fund manager with the freedom to invest across large, medium-sized and higher-risk smaller UK companies. He has the support of a well-resourced team and other AXA fund managers.
The fund is fairly small in size. This means it's agile enough for the manager to take advantage of almost any opportunity. We expect the fund to deliver strong returns over the long term, although there are no guarantees. It features on the Wealth 150+ list of our favourite funds across the major sectors.
How has the fund performed?
The past year was a tale of two halves.
The first half was strong and the fund outperformed the broader UK stock market. Engineering consultancy business IQE was one of the fund’s strongest performers. Investments in payment processing companies Paysafe and Worldpay also performed well when they had takeover offers from competitors.
In the second half of the year, the fund underperformed the UK stock market. The share price of alcoholic drinks distributor Conviviality dropped in March after it released a profit warning. The manager sold his investment in response to the news and the company later went into administration.
|Annual percentage growth|
|Apr 2013 -
|Apr 2014 -
|Apr 2015 -
|Apr 2016 -
|Apr 2017 -
|AXA WF Framlington UK||N/A*||N/A*||N/A*||20.5%||8.2%|
Past performance is not a guide to the future. Source: Lipper IM to 30/04/2018.
*Full year data before April 2016 is not available for this fund.
Chris St John has managed UK funds for more than a decade. Our analysis of his long-term track record shows he's added value by investing in companies with outstanding prospects. We expect this to drive future returns, although there are no guarantees.
How is the fund invested?
Chris St John identifies themes, and invests in companies he thinks will benefit as the theme develops. Current themes include companies that use technological innovation to win business from competitors.
Online travel agent On the Beach is an example. The company’s competitors include Thompson and TUI. Both businesses own fixed premises and spend a lot of money on staff. On the Beach is an online-only business. This means its costs are lower and it can charge lower prices to its customers. This helps it to win business from the competition.
Another theme is companies that offer market–leading levels of service. An investment in Marshalls fits this theme. The company makes paving slabs, which is an industry where it is difficult to stand out from the crowd. But the company has pioneered new ways of laying their slabs more quickly and efficiently which sets them apart from their competitors.
Please note the AXA WF Framlington UK Fund is an offshore fund so investors will not be protected by the Financial Services Compensation Scheme.
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