The manager of the £1.8bn UK Special Situations fund increased his exposure to the asset management industry in the first quarter of this year by buying into Jupiter Fund Management, whose share price has risen substantially as the markets have rallied.
The fund had already invested in Schroders, which Mr Plackett highlighted as one of his best-performing stocks so far this year “mainly because the market has been going up, but also because the deal to buy Cazenove was well received by the market”.
Jupiter’s share price has risen 64 per cent from 209.4p in May last year to 344p as at last week, while Schroders has seen its share price double in the past year from £12.50 to £25.40.
The manager said he was happy to own companies which had seen their share prices bid up because investors perceive them as safe.
He said he was positioning the fund even more heavily into what he thinks are quality companies within sectors, even if that means paying a bit more for them.
Mr Plackett said he would continue to hold companies such as Unilever and Diageo, even though both are currently on price-to-earnings multiples of 20 times, because “you’re better off paying a bit more for growth”. The manager also upped his exposure to Royal Dutch Shell in the first quarter of the year, while at the same time reducing his holdings in HSBC, Barclays and BHP Billiton, and selling completely out of drugs firm AstraZeneca.
Elsewhere, the manager said he was now trying to take advantage of an increased amount of stock dispersion in markets.
Mr Plackett said much of his portfolio activity in 2012 involved moving the portfolio tactically between large and small-cap companies as one section of the market rallied more strongly than the other.
However, the manager said the market had become more balanced this year meaning there were more stock-specific opportunities for managers to take advantage of rather than shifting wholesale from one section of the market to another.
The latest Pridham Report on fund flows in the asset management industry found that the popularity of Mr Plackett’s UK Special Situations fund had propelled BlackRock to the top of the charts for gross inflows into its funds in the first quarter of 2013.
The inflows come in spite of the fund dropping into the third quartile of the IMA UK All Companies sector for performance in the year to May 16, according to figures from FE Analytics.