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Schroders shifts Core UK Equity fund strategy

Schroders shifts Core UK Equity fund strategy

Schroders has shifted David Docherty’s Core UK Equity fund away from the business cycle approach used since the manager was at Cazenove Capital.

The asset manager said the £120m fund, previously known as Cazenove UK Growth & Income, would now use a more conventional bottom-up, analyst-led approach.

The business-cycle strategy, which sees managers divide companies into seven sectors that they believe stand to benefit at specific points in the economic cycle, was used by most managers at Cazenove, which Schroders acquired in 2013.

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Schroders said other former Cazenove equity funds, including Matt Hudson’s UK Alpha Income and UK Opportunities portfolios, Steve Cordell’s European Opportunities fund and James Sym’s European Alpha Income vehicle, will continue to employ the approach.

Mr Docherty’s fund has lost 3.7 per cent over the past three years, compared with an average return of 17.4 per cent for the Investment Association’s UK All Companies sector, according to FE Analytics.

Over one year the fund has shed 15 per cent compared with a 6.3 per cent drop for the sector.

The fund’s key investor information document has been updated to reflect the change, though the switch does not require an amendment to the portfolio’s investment objective and policy.

Schroders said: “The investment team has decided the fund will move away from business cycle investing and towards a core bottom-up investment approach.”