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Correspondent week

I am glad to say that the markets have not lost their capacity to surprise. My few months&#39 gardening leave between my exit from Christows and my arrival at iimia have seen some of the most torrid times the FTSE has seen for decades.

It has been frustrating seeing it from the sidelines. No matter how excellent our financial media are, there is no substitute for sitting down with fund managers on a one-to-one basis and getting a real feel for what they think the markets will do.

My first project at iimia is to prepare for the launch of our first fund, which will be an onshore UK Oeic, which we hope to launch in September.

Therefore I am back on the road again.

A large part of our time is spent visiting Scotland, the historic home of investment trusts. We used to be able to fly direct from Bournemouth to Scotland but this is no longer the case so we have been experimenting with alternative routes.

We started off the week with the first of these experiments – the Easyjet experience – not so easy as it turned out. We left around 6am for an 11am departure from Gatwick, arriving in good time, we were only 20 minutes late in boarding.

Just when we felt all was going to plan, the steward announced that the next available slot was at 8pm. We did, however, get off the ground by 1pm but all too late for our first set of meetings.

We could drive next time – it is, of course, important for us to visit Scotland and we will make frequent trips (alternative travel plans gladly welcomed).

We did see a familiar face as soon as we hit Edinburgh – we bumped into Paul Chesson of Perpetual. Our trip to Scotland included meetings with Edinburgh Fund Managers, Martin Currie and Ivory & Sime.

An area that we are particularly interested in looking at is those fund managers who have run big funds successfully and who then move into boutiques to run smaller funds.

This is a trend that we have seen quite a lot of recently. I meet with Max Ward, a classic example of this, ex-Baillie Gifford who is now at Independent Investment Trust.

We are also interested in looking at funds which are currently out of favour but which we feel offer value. I met with Robin Batchelor of Merrill Lynch new energy investment trust, which at the time of launch was flavour of the month. It is currently trading at a fraction of the issue price. The market perception and the reality are at odds and this is a good example of the sort of trusts that we will be looking at.

I have met up with many of the split-trust managers. This market is filled with fear and has the effect of clouding people&#39s judgement – there are still some splits which offer good opportunities.

We reckon that a third of the splits&#39 market look safe and are priced quite expensively and a third are pretty well bust. But a further third are seriously underpriced and offer good buying opportunities.

I have been catching up with individual trusts and am particularly keen on Govett&#39s European (zero shares) and BFS Absolute (zero shares). We are also looking at Aberdeen and Exeter.

Even among all the carnage, we believe that decent opportunities still exist.

We finish off the week in a convivial manner when Neil Mainland and Kat Milne from Mainland, our PR consultancy, come down to Ringwood to have a look over our systems and begin discussing our press campaign.

They also act as guinea pigs for our planned press hospitality programme. A trip to the country and discussion of the investment trust markets, followed by beer, a curry and a night in our most modest local hotel. Well we are living in the post-Sandler 1 per cent world after all.

Nick Greenwood is investment director at iimia


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