Discover Hidden Investment Gems with Marlborough's Special Situations Fund
In today’s ever-evolving financial market landscape, discerning investors seek funds that can uncover potential in discreet corners of the economy. The Marlborough European Special Situations Fund, managed by stalwart David Walton, exemplifies this endeavor. With an impressive trajectory spanning over a decade, this £247 million fund has consistently outperformed its peers with a remarkable return of 229% over ten years. In contrast, the average European fund (excluding the UK) has yielded 108%.
A Strategy Grounded in Discovery
Walton’s philosophy is methodical and exacting. His team sifts through a staggering 5,000 businesses in Europe’s investment arena, specifically targeting the bottom 20% by market capitalization. From this pool, about 2,000 companies pass the litmus test of profitability and potential. Through a diligent selection process, Walton narrows this number down to a focused list of 160-180 firms. Currently, 73 companies are part of the portfolio, offering ready liquidity and trade versatility.
Meeting the Market
Integral to their strategy, Walton and his colleagues – Steve Robertson and Tom Livesey – actively engage with potential and current investments. Last year alone, they conducted over 370 company visits across nine countries, ensuring on-ground realities align with projections. This hands-on approach fortifies their investment decisions, a point illustrated by Walton’s recent trips to evaluate Italian firms B&C Speakers and El.en.
Holdings That Speak Volumes
Marlborough’s approach doesn’t overly concentrate positions, capping individual stakes at 2%. Nevertheless, when an investment flourishes, it is allowed to mature. A prime example is their stake in Greek company Sarantis, lovingly dubbed a ‘mini Unilever’ by Walton. This holding, in place since 2016, mirrors the firm’s success, having seen its share value more than double.
Forward-looking Opportunities
Looking ahead, Walton is upbeat about prospects, especially as European powerhouses such as Germany pivot towards increased spending in defence and infrastructure. Such moves are anticipated to offer fertile grounds for small to mid-sized enterprises to shine, thus benefiting the fund’s portfolio strategically.
A Competitive Edge with Elite Recognition
Marlborough ESS doesn’t merely rest on its laurels; it continues to hold a coveted ‘elite’ status from FundCalibre, praised for its nimble and discerning market engagements. This is Money
With such a seasoned strategy and commitment to uncovering under-the-radar treasures, the Marlborough European Special Situations Fund stands as a beacon for investors looking to tap into Europe’s more discreet opportunities.