Go in hard says Weintraub

There are just a handful of fund managers across Europe who are regularly named as top picks by a broad range of our readers. Filip Weintraub is one. His performance running the Skagen Global fund brought him international attention but when he quit the Norwegian boutique last year it initially looked as if he might drop out of sight.

Fortunately for his followers, Weintraub is very much still on the scene with a new outfit of his own and he is determined to use his greater freedom to pursue the kind of long-term investment strategy he believes – worryingly – is becoming increasingly rare.

Conviction is a quality that fund selectors frequently tell us they look for in a fund manager and watching Weintraub address a room full of investments professionals, you can see he scores heavily in this area. Everyone is listening attentively. He is a forceful speaker with strong opinions, and he knows how to make them clear to his audience.

One reason they listen so attentively is his track record. He took over the Skagen Global fund in August 2001 and up until March this year, when he stepped down, he returned 176% in euro terms compared to a 1% fall in the FTSE World Index.

His commitment to his new venture is also pretty clear. He has ploughed all his liquid net worth into the fund he has created for the new operation, Labrusca Family Office. The name seems as much a statement of intent as a description of the business: Weintraub has been promoting his new fund to outside investors but wants to break away from the short-term culture that he sees undermining many fund managers’ efforts.

He aims to spend the rest of his career on the Labrusca project and says his investment strategy will reflect this.

‘In the short term it’s quite a noisy game,’ says Weintraub. ‘The key is to be long term. We are doing this to manage our own assets, and we’re called a family office because number one we focus on capital preservation, inflation adjusted, and number two on opportunities. We don’t believe in trying to have very smooth returns, we think that’s naïve. You have to expect volatility in the markets, that’s what gives you the opportunities.

‘In the medium term you can clearly get a niche sub-segment that goes very well. Lately it’s been oil and commodities, some emerging market countries have really taken off – look at Brazil with the revaluation over the last six years. In the medium term if you’re more of a sector-based analyst perhaps that would work. But I’m very sceptical of such an approach.

‘The least controversial is the long term. It’s quite amazing, on a 10-year track record all the best funds are niche funds: a biotech fund or something like that. And on a 20-year horizon, which we happen to apply – I’m committing the next 20 years of my life to doing this, at least – it’s always the process which wins.’

It is also striking which process wins, he says. ‘There are a few exceptions like Soros and these types of guys, but generally it’s always a value-based, company specific approach. You know these great names as well as I do. The process is what works on a longer timescale.’

The problem, if there is one, is that this kind of approach can seem dull to investors who have become used to the excitement of following the quarterly fluctuations of stock markets. ‘It’s boring, it’s not exciting, it doesn’t get the hormones going, and everybody wants to stay so focused on the next year,’ says Weintraub. ‘But the long-term story is surprisingly uncontroversial, actually.’