Not only had the fund seen a succession of managers but there were holdings in the portfolio that Mr Cholwill remembers were not paying a dividend. He calls it a “straightforward restructuring” in that the fund had enough critical mass to be able to sell some investments in order to reinvest in what he recognised as better opportunities.
So how did he come to specialise in UK equities? It all started in the 1980s, when, having begun working at Equity & Law as an actuarial trainee, he moved into the investment side.
“You had the North Sea oil boom just starting in the 1980s, so there was a lot of money coming into the UK – the UK had a lot of wealth to recycle,” he says. “It meant that essentially the money coming into UK equities was quite large and was very much a growing market.
“Of course, in recent years there have been fewer fund management opportunities than perhaps 20-30 years ago – just far fewer people working in UK equities [and] mandates have broadened a lot more. [There is] a lot more money in fixed interest these days and a lot more in international equities.
“The good thing about the UK stockmarket, of course, is it’s always been very international by nature. So although a lot of companies are quoted in the UK, UK companies are very diverse. Whether investing in large-cap or mid-cap [stocks], there are always a lot of opportunities to invest internationally.
“That’s how I started out and I have essentially been working in equities ever since. I stayed at Equity & Law for just over 20 years and joined Royal London just over 10 years ago.”
Mr Cholwill is also very aware of the political environment when investing, suggesting “you don’t pick stocks in a vacuum”. Having started his career in Margaret Thatcher’s Britain of the 1980s, this is no surprise.
He remarks: “Certainly over the past 30 years I’ve seen a range of economic environments. The pre-credit crunch period is very different from the post-credit crunch period. Pre-credit crunch, we had a lot of economic cycles. We’ve seen a lot of shades of politics.
“As a broad generalisation, the Thatcher era and post-[Thatcher] free market economics reigned supreme. People believed in free markets and that was the best thing for everyone in terms of creating wealth.”
But he concedes: “What’s changed, of course, is governments have become far more interventionist since the credit crunch. Banks are the most obvious example. Before the credit crunch it was very much light-touch regulation; now we’ve had a reaction to that after the credit crunch with a lot more focus from government and a lot more regulation.