Mark Slater: why Covid can boost half this fund in 2022

TL;DR

Mark Slater explains the key drivers behind the outperformance of the Slater Growth Fund in 2021 and discusses potential challenges and opportunities in 2022.

Transcript

hello with me today i have mark slater who runs the eponymous growth and income funds hi mark hi lee it's been another strong year for the slater growth fund and you've significantly outperformed the benchmark could you explain the key drivers behind the outperformance in 2021 the biggest factor has been that our larger holdings have done well um f... Read More

Key Insights

• 🥹 The success of the Slater Growth Fund in 2021 can be attributed to larger holdings like Future Group and Next 15, as well as minimizing mistakes.
• 🙃 Mark Slater acknowledges the challenges posed by high inflation and rising interest rates in 2022 but believes that owning businesses with strong fundamentals can mitigate the impact.
• ❓ Approximately half of the fund's portfolio has recovery or momentum potential due to COVID-19, while the other half demonstrates healthy momentum for other reasons.
• 🙃 Mark Slater emphasizes the importance of fund managers owning a stake in their funds, highlighting his substantial ownership as a demonstration of commitment and accountability.
• 🥹 The fund is actively managing liquidity and was recently active in the market, taking advantage of falling share prices to add to existing holdings.
• 👋 Mark Slater's investment strategy remains focused on buying good businesses at sensible prices and prioritizing cash flow, with minimal changes expected in response to external factors.

Questions & Answers

Q: What were the key drivers behind the outperformance of the Slater Growth Fund in 2021?

Mark Slater attributes the fund's success to the strong performance of larger holdings such as Future Group and Next 15. Additionally, minimizing mistakes and the acquisition of companies like CVS Liontrust Gamesis contributed to the outperformance.

Q: What is Mark Slater's view on the prospects for financial markets in 2022?

Slater acknowledges the challenges posed by high inflation and rising interest rates but remains confident in the recovery from COVID-19. He focuses on owning businesses that can navigate these challenges and believes that as long as a company's fundamentals are strong, the impact of external factors can be mitigated.

Q: Will Mark Slater need to adjust his investment strategy in response to future events?

Slater states that the essence of the investment strategy, which involves buying quality businesses at good prices and prioritizing cash flow, will not change. While he acknowledges the need to learn from past experiences and pick up signals of potential problems, he believes the core principles should remain the same.

Q: Are there any significant events or emerging themes that could positively affect the growth fund's performance in 2022?

Slater mentions that approximately half of the portfolio has recovery or momentum potential due to COVID-19, while the other half shows healthy momentum for other reasons. While there are no specific events predicted, he remains confident in the businesses owned by the fund and their sensible pricing.

Summary & Key Takeaways

• The Slater Growth Fund has seen strong performance, primarily driven by the success of larger holdings like Future Group and Next 15.

• Mark Slater acknowledges the potential challenges of high inflation and rising interest rates in 2022 but remains confident in the fund's focus on strong businesses at reasonable prices.

• Roughly half of the portfolio has recovery or momentum potential due to COVID-19, while the other half demonstrates healthy momentum for other reasons.