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The fund has had its performance bolstered over the last few months due to its involvement in companies such as Norwegian hydroelectric company Hafslund and German solar company Solon. Rupert Morrell, lead manager on the fund, said he saw those companies as currently undervalued and that the alternative energy sector in general had historically done very well in difficult times.

"We have had a good run since March," he said. "We've sold off all our defensive names just when the market turned, and we have bought into a number of alternative energy stocks and financials, such as ING, which are currently trading on strong positions."

Mr Morrell has also reduced his cash position. He had 12 per cent in cash, but has now put this money back into the market by buying banks and oil-sensitive stocks such as airlines. He maintains he is taking a contrarian view to most managers, and while he is not bullish, he is fully invested.

"Things have got too out of control, and there is indiscriminate panic selling," he said. "The world is facing a tough time over the next three or four years, and, in the short term, the stock market is discounting this news.

"Savvy investors should be looking to get into the market, not sitting on their hands."

Other areas Mr Morrell is buying into include the telecoms arena, specifically German mobile phone operator Drillisch, which he expects will become an acquisition target within the next few months.