InvestmentsFeb 10 2014

“You are never bored investing in the US”

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by

However her career could have gone down a slightly different route when she joined Neptune Investment Manage-ment, as she was offered a choice between the US and Latin America.

“I decided to stick to North America,” she explains. “For me it was, and still is, the world-leading economy with the most dynamic and interesting companies.

“It has such a diverse stock market and economy that you are never bored investing in the US. There is a huge range of companies, from chemicals to retail to oil and gas, and also pioneering companies on the forefront in things like technology as well.

“The US is a really exciting market. In many ways, it is like an emerging market, but with developed market corporate governance, in terms of being able to read financial statements and meet the management, so you have that structure that goes along with it.”

After almost six years at Neptune, Ms Edelman remains enthusiastic about both her role – currently manager of the Neptune US Income fund and assistant manager of the Neptune US Opportunities fund – and the team, having found her niche after a brief foray into teaching.

“I studied economics at school and I always loved it and found it fascinating, but I wasn’t someone who was part of any investment group or anything like that. It was a similar thing at university. I studied economics – my degree was actually politics, philosophy and economics (PPE) at Oxford, but I specialised in the economics side.

“I enjoyed the diversity of the subject, particularly the macro nature of it and the interplay with the politics side of my degree was always really interesting. I loved how it related to current affairs and what you were seeing everyday in the news, but it wasn’t necessarily an obvious link for me that investment was the way I was going to go.”

Instead, after graduating and knowing she’d like to work in the City but with no firm ideas, she joined a two-year programme called Teach First that enables graduates to become qualified teachers and gets them into challenging London schools.

“I thought Teach First sounded like a bit of a challenge and I love a bit of a challenge,” she says. “So I thought I would give that a go. I loved it and really got a lot of out of it, but after two years, as much as I enjoyed it I didn’t think that teaching was going to be my career for the rest of my life.

“So that is when I started exploring options in the finance world, talking to friends and doing lots of placements.”

This eventually led her to asset management, particularly through her enthusiasm for economics and a top-down macro viewpoint.

She explains: “To be able to look across such a range of companies taking that macro economic backdrop and education that I had and applying that and really having that top- down view of the world and how companies and countries fit into it was just really fascinating. Particularly so at somewhere like Neptune that does have that more macro approach, to be able to ground the investment ideas from the economics.”

While still clearly enjoying the chance to work with macro themes and influences, she has grown to love the more in-depth company- specific analysis even more.

“The part of the job I love the most now is actually meeting companies and talking to management teams. It feels very privileged to be sitting down in front of chief executives of multi-billion pound companies and asking them questions about how they run their business. For me, what I really enjoy is getting to grips with what a company does, what its growth prospects are, what its strategy is and what its financials are.”

Her career at Neptune seems almost pre-destined as, while looking broadly across the asset management industry, she made a checklist of the type of place she wanted to work, including a top-down macro-orientated long-only fund management house.

“That was step one, then I liked the idea of working for more of a boutique firm and when I joined Neptune it was still a relatively small, young and dynamic team. Although I came from a teaching background, the team had people from a range of backgrounds and experience. I actually think having done something different before coming into asset management can be an advantage as it gives you a wider appreciation of the economy and markets.”

Initially starting as an investment analyst in 2008, after two years Ms Edelman had become assistant manager on the £415.1m Neptune US Opportunities fund to Felix Wintle, and taken the lead on the launch of the £21.4m Neptune US Income fund.

She notes: “The great thing about being at Neptune is they do give you a lot of responsibility early and you get to run money from a much earlier stage in your career than perhaps anywhere else. As much as that is scary, it’s just a great way to learn. You start with smaller funds, but get a huge amount of support from sales and marketing behind the funds. I feel like I’m in a great position to take my fund today and continue to grow it.”

The performance of the US Income fund slightly lags both the IMA North America sector average and the S&P 500 index for the 12 months to January 22 2014, according to data from FE Analytics, so does having an income slant make it more difficult?

“It does. I do have a yield target on the fund and, given how strong the market has been, yields have obviously compressed. Having said that, the reason why we set up a US income fund in the first place was that, in our view, the US was an unexplored market for income investors. I think investors historically thought US companies don’t like to pay dividends or do buybacks and it is a low-yielding market as well – roughly 1.9 per cent on the S&P 500 index. But what we’ve seen over the past four years is companies taking a different approach to shareholder returns. They’ve really been increasing dividend growth. Companies are sitting on huge piles of cash, but they are starting to return this to shareholders.

“We think the US is actually an interesting market for income investors – and an unexplored market as well.”

For someone who enjoys their job so much it can be difficult to switch off, especially when she says she is a morning person and US markets are open late into the evening on UK time, but it is something she’s “learned to do”.

“I think as a young fund manager it is tough, particularly when my market is open until 9pm. It is tough not to be checking stocks and newsflow, but I’ve got better at that. Having a break is important. My outlet is that I’m a bit of a sports freak – going to the gym is a great way to burn off excessive energy.”

It also helps as Ms Edelman starts final training for the London marathon in April, having decided to take on the event after previously competing in a couple of triathlons – and while still competing on the Neptune netball team.

Continuing with the theme of the interview and what seems to be a personal mantra, she says: “People think I’m crazy, but I’ve never done a marathon and I like a challenge, so why not?”

CV

2010 – Present - Manager of the Neptune US Income fund and assistant manager of the Neptune US Opportunities fund

2008 – 2010 – Investment analyst, Neptune Investment Management

2005 - Joined the Teach First programme teaching Maths and Economics to secondary school students

2005 - Graduated from Oxford University with a first class honours degree in Philosophy, Politics and Economics (PPE)