• This fund's unique structure combines the best ideas of four fund managers, whose strengths and styles are carefully blended together
• We like the fund's flexible approach, which means the managers are free to invest wherever they see the best opportunities
• They have a good long-term track record, with good stock picking skills amongst larger companies
• The fund features on the Wealth Shortlist of funds chosen by our analysts for their long-term performance potential

How it fits in a portfolio

The best ideas of an experienced team, combined with their willingness to invest differently from the herd, makes the Liontrust UK Equity fund stand out from other UK growth funds. We think it's a good all-rounder for the UK part of a portfolio. It could sit well alongside other funds that invest more overseas.

Manager

The fund is managed by a team of four managers, each with their own strengths, styles and areas of focus. They moved across to Liontrust after the business acquired Majedie in April 2022. 

James De Uphaugh and Chris Field have been analysing and investing in UK companies for more than three decades. They were both founding members of Majedie Asset Management and have served as co-managers on the fund since launch in 2003. Imran Sattar joined the team in 2018 and has more than two decades' experience in UK equities. The trio are each responsible for 30% of the fund and focus primarily on large and medium-sized businesses.

John King joined Majedie in 2019. He previously worked as a fund manager at AXA alongside well-regarded fund manager Chris St John. King is responsible for 10% of the fund and focuses on higher-risk smaller companies.

We're mindful there have been a number of team changes in recent years but encouraged that longstanding fund managers James De Uphaugh and Chris Field remain central to the strategy.

Process

The team use a flexible investment process on this fund. Each manager is given the freedom to invest according to their own strengths and styles, which are carefully blended together. This means the fund combines more established companies that have consistently grown profits, with those that have been through a difficult time but have the potential to recover.

The managers don’t focus on any particular sectors. They prefer to adopt a whole-of-market approach as this reduces the risk that they have blinkered views in favour of their own sectors. The managers also spend time thinking carefully about how economic changes can impact the companies they invest in, and this is built into their analysis.

The team draws on a broad range of tools when coming up with investment ideas, including in-house systems and technical models improved through decades of experience. Key to their investment process is regular meetings with company management teams. The meetings allow the team to probe management and glean insights that aren't available through the report and accounts.

In recent months the managers sold their position in Direct Line and invested in fellow insurer Admiral. They feel that Admiral offers a higher growth potential and a higher quality of earnings and so added the company to the fund.  

Please note the fund invests in Hargreaves Lansdown plc.

Culture

Liontrust gives managers the freedom to manage their funds according to their own investment and market views. The company simply asks managers not to deviate from their investment processes. Each manager's funds are regularly checked by other senior managers at Liontrust to ensure they're staying true to their investment processes.

We like that Liontrust fund managers invest a significant amount of their own money into the funds they run. This helps to align their interests with those of investors.

The managers moved across to Liontrust when the business acquired Majedie. Acquisitions and other corporate changes can unsettle investment teams, creating the potential for fund manager or product changes. We haven’t seen any evidence of this so far, but we’ll continue to monitor the situation closely and keep investors informed if our views change.  

ESG integration

The managers consider environmental, social and governance (ESG) factors as part of their company analysis with a focus on materiality. Each company is assigned a resilience score which is driven by how well they manage the key issues that affect them.

The quality of ESG integration varies across Liontrust as managers run their portfolios according to their own investment and market views. The company simply asks managers not to deviate from their investment processes. Some managers have chosen to fully integrate ESG, while others are still developing their approach.

Cost 

This fund has an ongoing annual charge of 0.65%, but a discount of 0.10% is available for HL investors, which reduces the charge to 0.55%. The fund discount is achieved through a loyalty bonus, which could be subject to tax if held outside of an ISA or SIPP. The HL platform fee of up to 0.45% per year also applies.

Performance

The managers have a good long-term track record and have outperformed the broader UK stock market, represented by the FTSE All Share index, over the long run. The fund has tended not to fall as far when markets are weak and has performed broadly in line with the UK market when it's been rising.

The last year has been a more difficult one for the fund, it’s lagged the FTSE All Share index’s return by 10.68%*. Media company Ascential and industrial suppliers RS group were among the biggest detractors from performance over the last 12 months. Oil and gas company Shell and pharmaceutical business AstraZeneca were among the fund’s better performing investments over the year.  Past performance is not a guide to the future.  

Despite a tougher period, over the longer term we think the fund has the potential to perform better than its benchmark, although there are no guarantees. Like all investments, the fund can fall as well as rise in value so investors could get back less than they invest.

Past performance is not a guide to the future. Source: *Lipper IM to 30/11/2022.

More about Liontrust UK Equity, including charges

Liontrust UK Equity Key Investor Information