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Credit Suisse revamps UK growth and income fund

Credit Suisse has repositioned its UK growth and income fund to adopt a more thematic approach.

The fund has be renamed the UK thematic fund and will look to add alpha by combining a top-down overview through various themes with bottom-up stock detail.

The fund will be less constrained as manager Marcus Hankey and team will not have to consider yield when looking for stocks that meet their theme objectives.

Potential investment themes the group will look at include GDP growth, unemployment figures, political figures and what is driving regulation.

Once 10 or so themes have been identified, the team selects the best stocks to capture those trends for the portfolio.

The team will also look to invest both aggressively and passively. For example, heightened security currently accounts for 5 per cent of total exposure in the fund. This comes courtesy of investing in BAE systems, which develops defence and aerospace systems, and Smiths Group, which produces screening devices used at Airports worldwide.

Other themes in the fund include the impact of falling interest rates and a belief that the commodity boom is set to end.

Hankey says: “The way we capture a theme may not always be by going for the obvious, as we have outlined in the security theme example. We add value to portfolio by taking a non-conventional approach which is not driven or constrained by any index. This allows us to avoid a lot of the noise in the market and forces us to take a long-term view which prevents us being buffeted around like a lot of managers who take a shorter-term view.”

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