Doddington Global Ex US Fund LLC
A focussed EAFE equity strategy with a classic, contrarian value approach to building long-term value.
Investment objective
The Fund seeks to achieve over the long term a total return in excess of that of the MSCI EAFE Index (with net dividends reinvested) through investment in a concentrated portfolio of equity securities, primarily but not exclusively of large companies, selected from the major markets (except the United States) and to a lesser extent from some emerging markets, worldwide. The approach is classic contrarian value, based on bottom-up fundamental research of individual companies.
Fund particulars
| Launch date | 01 February 2017 |
|---|---|
| Fund size | US$41.6m |
| Domicile | USA |
| Structure | LLC |
| Base currency | USD |
| Dealing | Monthly |
| Min. investment | US$3,000,000 |
| Management fees | 0.90% per annum |
| TER | 1.12% per annum |
| Benchmark | MSCI EAFE |
Andrew Goodwin
Nigel Waller
Andrew Goodwin
Andrew joined OP in March 2013. He had previously been employed by SVG Capital in London for seven years managing mainly European equity portfolios. Before joining SVG, he held portfolio management positions at Sovereign Asset Management, American Express Asset Management and Phillips & Drew Fund Management. He graduated from Cambridge University. He co-manages the global and EAFE equity portfolios and contributes to the overall investment selection.
Latest publications
Latest publications
Nigel Waller
Nigel is one of the founding partners of OP. He was previously at MLIM for 13 years. He was a director and portfolio manager on the global team. At MLIM he was also a member of the emerging markets and European teams in London and, from 1997 to 1999, the Asia team in Singapore. He graduated from City University. He is Chief Investment Officer and Chief Executive. He co-manages the global and EAFE equity portfolios and contributes to the overall investment selection.
Latest publications
Latest publications
EAFE Equities Strategy
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Commentary
The fund fell 7.8% in April while the MSCI EAFE Index fell 6.5%. The largest negative contributors to performance were, in order of impact, Deutsche Bank (-18.1%, total return in local currency), Marston’s (-7.7%, total return in local currency) and Toyota Industries (-8.0%).
Deutsche Bank reported results that showed improving revenue trends across several parts of its business. The Private Bank and Corporate Bank operations performed well, benefiting from volume growth and rising rates. However, cost control was disappointing. This comes against targets to reduce costs and improve the group cost:income ratio. Deutsche Bank is trading on a price-to-earnings multiple of 6x and a price-to-book value of 0.3x.
Fairfax Financial (+3.5%) and Lloyds Banking Group (+0.4%) were two of the better performers in the month.
Fairfax is the Canadian based invest insurer run by Prem Watsa. It has compounded its book value per share at 19% per year since listing in 1985. The company is a beneficiary of rising rates as the bond portfolio is invested with an average duration of 1.4 years. Liquid assets are currently being re-invested at more attractive rates, which will drive higher investment income. The underlying business is also performing well; Fairfax is seeing strong premium growth and the underwriting standards are good. Fairfax is currently trading on a price-to-book value of 0.8x compared with recent acquisitions in the insurance sector at 1.2-1.3x book value. The company recently tendered to retire 10% of the share count.
Lloyds Banking Group reported a solid set of results. The company raised its guidance for the net interest margin, supported by rising interest rates. Cost control remains good and asset quality is strong. Lloyds is now guiding for the return on tangible equity for 2022 to be greater than 11%. The company is repurchasing its shares (£2bn; 6% of shares outstanding) and has a dividend yield of 5%. It is trading on a price-to-earnings multiple of 8x and a price-to- book value of 0.8x.
Commentary
Commentary
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