Focusing on megatrends gave Insync Funds Management the push it needed to take out Money Management’s Emerging Manager award this year.
Insync’s chief investment officer, Monik Kotecha, said the Insync Global Quality Equity fund was able to produce strong absolute returns on a risk-adjusted basis over the past year.
Kotecha said the fund focused on high-quality growth companies that fell into one-of-16 “unstoppable megatrend” categories.
“The companies we invest in are on the right side of disruption, are intensely profitable, have long-term durability, and we believe will have superior performance,” he said.
Kotecha said two of these megatrends were the ‘food prepared away from home’ market, and ‘pet humanisation’.
“We focus on finding two or three stocks per megatrend and this gives us a diversification so if one or two megatrends don’t work out the way we think it will then the other 14 should perform really well,” he said.
“It’s a concerted effort within the investment team and whilst we have high conviction, we have 30 stocks so we want to ensure we get strong returns from as many megatrends and stocks as possible.
“In the last 12 months over 75% of our stocks outperformed the due to our systematic and risk discipline way of investing.”
Kotecha said those stocks had a lot of cash, strong balance sheets, and were not sensitive to the economy which meant they fell a lot less during market downturns.
For finalist Fairlight, portfolio manager Nick Cregan said its Global Small and Mid Cap A fund took a low-risk approach to a slightly higher volatile part of the market and had invested in quality companies that delivered alpha.