To see the importance of a style or size bias investors merely have to look back at history. For instance, in 1999, high-yielding stocks, as represented by the FTSE 350 high yield index underperformed low-yielding stocks by 9.74 per cent while FTSE 100 stocks underperformed FTSE small cap stocks by 33.22 per cent. Fund managers that had a tendency towards higher-yielding and smaller companies over the last few years will have had a tailwind behind them while large-cap managers with a low yield tilt would have been fighting a headwind.Relatively few managers are able to change their style to fit changing market conditions and generally stick to one investment style. We avoid the temptation of targeting sectoral, style or geographical positions since we do not believe that this is our own skill set. We try to follow the basic principles that lead to superior performance by individual fund managers – stockpicking ability to drive long-term performance. This iis how we approach building our fund of funds. he key for us is to separate the manager’s skill from the luck of being in the right style at the right time. We search for managers to outperform their style on a consistent and meaningful basis over the medium to long term. The by-product of our search for these attributes (qualitative as well as quantitative) can be most starkly seen in our HL multi-manager special situations trust which has no geographical restrictions. Our hunt for these exceptional stockpickers has led us to have significant holdings in Phillip Gibbs’ Jupiter financial opportunities, Mark Hall’s Rensburg UK select growth, Luke Kerr’s Old Mutual UK select smaller companies (offshore), Phillip Wolstencroft’s Artemis European and Richard Pease’s New Star European growth funds, to name but a few. All of these managers have exhibited exceptional stockpicking ability over the longer term. By combining these top managers from around the world, our aim is to produce the highest total returns.