View more on these topics

‘Over-optimism’ hits BlackRock UK absolute alpha fund performance

Mark Lyttleton, the manager of the £2 billion BlackRock UK absolute alpha fund, has expressed disappointment with its short-term performance but dismissed concerns about the size of the portfolio.

He says over-optimism on valuations this year was the key factor in underperformance, with the vehicle’s net long positioning leaving it exposed as markets fell.

Over the first half of the year the fund fell 2.2 per cent, although it has returned to positive territory for the 12 months to August 9.

“Poor performance of the short portfolio was largely due to the strength of the FTSE 250, which we had used to reduce market exposure,” says Lyttleton. “We felt the FTSE 250’s more domestic focus made it particularly vulnerable, but in the short term this analysis proved flawed.”

Lyttleton’s long-only UK dynamic fund is also behind the index this year and he says the market has not recognised good operational news at many of his long bets.

“Overall, the team is comfortable with the balance on the long side between cyclical holdings – where mid-cycle valuations look attractive – quality long-term growth companies and lowly valued defensive earnings streams,” he adds.

Lyttleton has cut long positions in companies sensitive to government spending on his long book. He has also taken shorts in stocks whose revenues are largely from the private sector but for which government subsidy is over 100 per cent of profit.



FSCS judicial review court date set

Regulatory Legal has secured a court date for its judicial review of the Financial Services Compensation Scheme’s levy, which will be heard on November 4 and 5. Regulatory Legal partner Gareth Fatchett says he has received strong support for his challenge of the Keydata interim levy from the industry. The firm is making a final […]

Ignis makes first move into tech with global fund offer

Ignis Asset Management is to launch a global technology fund under the management of Geoff Paton. Ignis is planning to soft-launch the Dublin-domiciled fund in Q4. It will hold 40 to 55 stocks and will be benchmarked against the MSCI all countries global IT index. It will be Ignis’s first move into the technology sector. […]


Aifa says ruling on Keydata does not set precedent for IFAs

Aifa says the Financial Ombudsman Service ruling against Norwich & Peterborough Building Society over its advice on Keydata should not alarm IFAs who sold the products. In a provisional judgment, the FOS ruled that Norwich & Peterborough should pay a couple’s £28,000 investment plus interest relating to a Keydata product invested in Lifemark. The judgment, […]


Scales of justice

The concept of “justice” is marvellously flexible. It is a word that acquires new meaning entirely dependent on whose mouth is articulating it. The definition ascribed to it by the Oxford Dictionary states: “The quality of being fair and reasonable.” When Walter Merricks, ruled as chief ombudsman , he advised the Treasury select committee, “we […]

The curse of long-term cash

Trevor Greetham, Head of Multi Asset at Royal London Asset Management, reveals why clients should be seriously concerned when short-term holdings of cash turn into a long-term investment. There is nothing wrong with holding wealth in the form of cash on a short-term basis. For many people capital stability is important and access to ready cash […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and thought leadership.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm