Ninety One UK Special Situations
Ninety One UK Special Situations aims to deliver capital growth by investing in unloved UK companies that the managers believe are undervalued. The portfolio was run by renowned contrarian investor Alastair Mundy from 2002 until April 2020, when it was handed over to his colleagues Alessandro Dicorrado and Steve Woolley.
Previously Investec UK Special Situations
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Alessandro is a portfolio manager in the Value team at Ninety One. Since April 2020, he has co-managed the UK Value strategies alongside his role managing Global Value Equity strategies, which he began in 2016. He joined Ninety One in 2011 as a Value team analyst. Before this, Alessandro worked as a fixed income derivatives salesperson at J.P. Morgan Chase & Co. in London. He holds a BSc in Economics from UCL and a Master’s in Finance from the London Business School. Alessandro has also passed Level III of the CFA Program.
Steve is a portfolio manager in the Value team at Ninety One. Since April 2020, he has co-managed the UK Value strategies alongside his roles managing the Global Special Situations and Global Value Equity strategies, which he began in 2016. Steve joined Ninety One in 2008, transitioning from his previous role at the Financial Services Authority, where he supervised asset managers and financial advisors. He holds a first-class Master’s degree in Mathematics from Nottingham University and is a CFA Charterholder.
Alessandro is a portfolio manager in the Value team at Ninety One. Since April 2020, he has co-managed the UK Value strategies alongside his role managing Global Value Equity strategies, which he began in 2016. He joined Ninety One in 2011 as a Value team analyst. Before this, Alessandro worked as a fixed income derivatives salesperson at J.P. Morgan Chase & Co. in London. He holds a BSc in Economics from UCL and a Master’s in Finance from the London Business School. Alessandro has also passed Level III of the CFA Program.
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Company Description
Ninety One is an independent, active global asset manager, managing more than £123.1 billion* on behalf of clients. Established in South Africa in 1991, as Investec Asset Management, the firm started offering domestic investments in an emerging market. In 2020, almost three decades of organic growth later, the firm de-merged from Investec Group and became Ninety One. Today, the firm offers active strategies across equities, fixed income, multi-asset, alternatives and sustainability to institutions, advisors and individual investors around the world.*as at 30.09.23
Fund Performance
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Quote from the Fund Manager
You basically want good stuff cheap. But most of the time, when you're buying it, it either won't look like good stuff or it won't look cheap
Alessandro Dicorrado
Co-Manager
Investment process
The investment process for Ninety One UK Special Situations is best described as contrarian, meaning the team seeks to exploit the ‘herd’ mentality of capital markets by investing in UK companies that are both unloved and undervalued. The team begins its search for new ideas by looking at shares whose prices have fallen substantially from their peak. It will then undertake detailed fundamental analysis, sifting out the genuinely troubled businesses from those which have been misunderstood by the market. The managers believe these companies are seldom out-of-favour forever and can generate strong returns as they are rehabilitated.
Risk
The fund has a bias to value stocks and, as a result, performance can be quite lumpy and is partly dependent on whether the fund managers' style is in or out of favour. That said, the Ninety One UK Special Situations fund has been slightly less volatile than the UK stock market over a prolonged period.
ESG
ESG - Limited
The managers believe that there is a fine line between incorporating ESG risks and value investing, which they try to tread with this fund. Whilst ESG integration naturally aligns with the fund’s long-term approach, ESG risks can be seen as opportunities for the fund, especially with the contrarian approach. As such, the managers do look at material ESG issues, to allow them to build a picture of a company, but they will use this to identify opportunities as much as they do to exclude stocks. As a result, the portfolio will often contain firms considered ESG laggards.
ESG factors are analysed in the due diligence and analyst report phase of the process. This will help the managers understand the structural ESG risks of a firm, and the valuation the market is applying to it. They will look to factors such as the quality of management teams, carbon emissions and labour issues in the supply chain. If these are deemed as material risks to the business and not considered in the valuation then they will avoid the company, but conversely if there are ESG issues adversely affecting the valuation, and the firm has a comprehensive plan to address this, it could be an investment opportunity for the fund.
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