Fund rules prevent Train from buying favourite stocks

Fund manager Richard Buxton, who runs the £1.6bn Merian UK Alpha fund, is skeptical that the performance of companies such as Unilever can be sustained.

He said that while market conditions have long favoured those companies, the valuations at which they trade makes them unattractive investments.

Andrew Bell, chief executive of the Witan investment trust, which has about 10 per cent of its assets invested in a separate fund run by Nick Train, said the investment has been the best performer in his trust for a long-time and he expects the fund manager to be able to perform in different market conditions.

He said: "When we invested with him, he had performed well for a few years, but the assets under management of his firm were not huge, and even then he said to us it might be better for us to deploy the money we wanted him to invest for us in stages, rather than all at once.

"But I had as much conviction in him as any of the other managers we use, so we put all the money with him.

"And I am very glad we did, because there hasn’t really been a period of underperformance since, and that was almost a decade ago."