New for 2017. A team-based approach helps generate ideas
This fund has been managed by Nick Williamson since January 2016. It invests in companies no bigger than 'the largest company in the Numis Smaller Companies index at the time of initial investment'.
The index covers around 700 companies comprising the bottom 10 per cent of the UK main market by value. The advantage of this fund is that it is still quite small itself at under £200 million, so it can take significant stakes in these companies.
Williamson took over as lead manager from Dan Nickols. He is still deputy manager to Nickols on the Old Mutual UK Smaller Companies fund. The Dublin-domiciled Focus fund is slightly more concentrated than the onshore fund, which may result in periods of greater volatility. It typically holds between 60 and 70 stocks.
Old Mutual Global Investors operates a team-based approach to UK mid- and small-sized companies, so Williamson is one of seven on the team researching these stocks. He says that this team effort helps to generate lots of ideas that can be investigated in greater detail.
He looks for two things in particular. The first is stocks that offer 'structural' growth, which means they can grow no matter what the state of the economy. Then he looks for stocks that generate plenty of free cash flow.