“Investing in zero-yielding illiquid and unquoted biotech stocks is certainly not normal territory for either a value manager nor an income fund.”
Notable fund managers
If the value style of investing does return to favour at some point, the likes of George Godber, fund manager at Polar Capital, Henry Dixon, manager of the Man GLG UK Income fund, Fidelity Special Values trust manager Alex Wright, and Ben Whitmore, head of strategy, value equities at Jupiter Asset Management have been put forward as individuals who attract support.
Darius McDermott, managing director of Chelsea Financial Services, added: “Sitting in that category you would [also] have the value team at Schroders who run Schroder Recovery; an out and out value fund. They also run Schroder Income and Schroder Income Maximiser and they have a suite of global funds all based on value as well.
“If you are looking for a slightly less well known name, you might have a look at Richard Penney. He runs the Crux UK Special Situations fund and he definitely has a value style. He likes companies to be growing, but does not like to overpay for them.
"In a portfolio, you would normally try to have some value and growth. We have not given up on value. We do favour growth styles over the next 12-24 months but we still hold some value in some of the managers I have mentioned."
Mr Moore said “There is still a case for pragmatic and well-executed value-sensitive strategies as part of a balanced portfolio.
“Richard Colwell manages the Threadneedle UK Equity Income fund. This is a valuation sensitive income fund which has managed to avoid the extremes that others mentioned have not.
“What I believe Richard has done well is blend undervaluation from different opportunities and when self-help stories gain momentum he has stuck with that.
"Examples of success include AstraZeneca and Rentokil, which were bought on undervalued metrics but have developed into well-recognised growth plays.”
