Proof that value investing pays off | Summary and Q&A

TL;DR

Ben Whitmore, manager of the Jupiter UK Special Situations Fund, discusses the potential catalyst for investors to return to the UK market, the success of value investing, and the rotation towards value shares in 2022.

Key Insights

• ❓ Overseas companies see value in the UK market despite investors' reluctance.
• 🧑‍💻 The composition of the UK market, with a focus on pharmaceuticals, oil, and mining, differs from tech-dominated markets.
• ⌛ Value investing can still perform well over time with patience and discipline.
• ❓ The rotation towards value shares in 2022 is uncertain but supported by valuation dispersion.
• 🥹 The Jupiter UK Special Situations Fund aims for a three to five-year holding period.
• 🥹 Examples of long-held investments include Airbus and Glaxo.
• 🥹 The decision to continue holding or cut losses depends on the company's fundamentals and market response.

Transcript

hello today i'm speaking to ben whitmore full manager of the jupiter uk special situations fund ben is a contrarian investor who invests in uk listed value shares the uk market has performed well over the past year but remains unloved by investors what do you think the catalyst will be for investors to return to the uk market well there's a very go... Read More

Questions & Answers

Q: Can value investing still be successful when it is out of favor?

According to Ben Whitmore, value investing can still be successful over time, but it may require patience and a disciplined approach. Periods of value recovery, like 2016, 2018, and 2021, can present opportunities for value investors.

Q: Will the trend of rotation towards value shares continue in 2022?

Ben Whitmore is uncertain about the long-term continuation of the rotation towards value shares. While there has been evidence of valuation dispersion, indicating an opportunity, the timing of a sustained trend is unknown.

Q: What is the average holding period for stocks in the Jupiter UK Special Situations Fund?

The fund aims for a three to five-year holding period for investments. Examples of companies held include Airbus, which saw a sharp recovery and was sold, and Glaxo, a pharmaceutical firm with a slower recovery.

Q: How does the fund decide whether to continue holding or cut losses for underperforming stocks?

The decision depends on whether the fundamentals of the company are improving or worsening. If the stock market is not rewarding improved fundamentals, the fund may continue holding. However, if the fundamentals are deteriorating, a reassessment may lead to reducing the position.

Summary & Key Takeaways

• Ben Whitmore acknowledges the outflows from the UK market in recent years but is uncertain about the precise catalyst to bring investors back.

• Overseas companies have seen value in the UK, leading to bids for UK companies, while investors remain hesitant.

• The composition of the UK market is different from tech-dominated markets like the Nasdaq, with a focus on pharmaceuticals, oil, and mining.