Citywire AAA-rated Richard Plackett takes time to understand the companies he invests in before he makes any decisions and as a result has returned 17.4% over 12 months compared to his average peer’s 15.6%.
He said: ‘I work from the bottom up, I had 700 company meetings last year because I like to understand the business’ management.’
As the head of UK small and mid-cap investment at Merrill Lynch, now renamed BlackRock, Plackett is meticulous in his approach to stock selection and places emphasis on businesses with a good market position and strong balance sheets, ‘I look for companies with long-term growth opportunities, companies that are going to be worth more in the next three years,’ he said.
Plackett, who runs both a small cap (Merrill Lynch UK Smaller Companies Inc) and a special situations fund (Merrill Lynch UK Special Situations Inc), is not worried about the decline of small-caps that is currently blighting the market, he said: ‘Small-caps have outperformed by 3.5% a year for the past 50 years. All the analysis that says that small-caps have done well and now it’s the turn of large caps just doesn’t stack up.’
Plackett has been attracting even more media attention since Anthony Bolton announced his retirement plans from his £6 billion Fidelity Special Situations fund (Fidelity Special Situations Acc), as people are looking at Plackett as an alternative.
He said: ‘Anthony’s one of the top fund managers of his generation and he knows what he’s doing. The amount of money was phenomenal but I completely agree with him, you can’t run that much money in a UK fund.’
He added: ‘At present we run £420 million so we have a lot of room to grow and the split has led to a lot of publicity for us, but we would rather sell our funds on our own merit that sell them off the back of the publicity that has been generated.’