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Seven wealth managers' top Leicester City moments

On the back of Leicester City’s astonishing Premier League triumph, we ask seven wealth managers to reveal their top against the odds experiences.

Against all odds

Is there an equivalent investment opportunity to Leicester City in today's world? The Midlands club, which narrowly avoided relegation last year, stunned the world of football by winning the Premier League title.

The few who took a punt on the club at odds of 5,000-1 will be feeling pretty smug with this ultimate contrarian call.

To mark this remarkable story, we ask seven wealth managers to reveal their top against the odds experiences.

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Against all odds

Is there an equivalent investment opportunity to Leicester City in today's world? The Midlands club, which narrowly avoided relegation last year, stunned the world of football by winning the Premier League title.

The few who took a punt on the club at odds of 5,000-1 will be feeling pretty smug with this ultimate contrarian call.

To mark this remarkable story, we ask seven wealth managers to reveal their top against the odds experiences.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Eric Woodward, investment director, Carrington Investments, London

For a Leicester city moment one of the first funds I bought and we still hold today was the Invesco Perpetual Global Financial Fund, which we bought at launch in 2011 - not a popular time to own financials.

The fund only attracted 50 million at launch, which is small for Invesco. We invested five million of clients funds at launch. We expected to get a return over rolling 12 month periods of roughly eight percent, because the fund was largely invested in bank fixed interest securities.

I felt that as banks had been forced to strengthen their balance sheets we might even see a little more in total return. In the event, over two years, the fund produced a total return of nearly 60 percent, which was way beyond our initial expectations and the area then became more popular with other investment advisors. This particular fund still only has around 150 million in it. It's under owned, but we still think it has potential, although with more modest returns now.

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Craig Ray, branch principal, Wilson King Investment Management, London

The completely unexpected and improbable nature of Leicester City winning the Premier League is indeed unbelievable. In terms of our own unbelievable achievement we maintain that was asking clients to believe in equities as a viable asset class during the financial storm of October 2008 and on into early 2009.

It was an almost unprecedented time and we spoke to clients constantly offering our words about how the long-term attractions of equities remained in place despite the plunges in stock markets seen during that time – indeed the “waterfall” formations seen in the charts of the major indices during October 2008 still astonishes.

By constantly stressing to clients that the stock market was in the grip of a financial maelstrom which was impacting all equities to a universally negative extent and that valuations were reflecting levels of concern not seen in decades we were able to soothe nerves and answer any questions in a calm manner.

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James Maltin, investment director, Rathbones, London

I’m not sure how unbelievable it is, but the achievement of which I’m proudest was raising more than £400,000 for Cure Leukaemia by riding the entire 2015 Tour de France event, one day ahead of the professionals.

Eleven of us cycled 110 miles per day for 21 consecutive days, climbing a total of 48,000 vertical meters – like travelling from sea level to the peak of Mount Everest, five and a half times.

One of our group was Geoff Thomas, the former England footballer. In 2003 Geoff was diagnosed with leukaemia and given three months to live. He was treated by Professor Charlie Craddock at the Queen Elizabeth Hospital in Birmingham, and has been in remission since January 2005. In 2015, to celebrate 10 years in remission and fundraise for Cure Leukaemia, Geoff and his team got on our bikes. The money we raised funded a network of specialist nurses who administer potentially lifesaving drugs to leukaemia patients who have exhausted all options on the NHS.

Together our team covered more than 2,000 miles, including seven mountain stages. To quote professional road cyclist Mark Cavendish, "the Tour de France is ridiculously hard...a rollercoaster of pain, fear, joy, crashes, excitement, boredom and pressure". I can vouch for that! But the sense of pride I felt is unparalleled.

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Matthew Hunt, principal and founder, Prospect Wealth Management, London

Prospect’s most recent “Leicester City” experience was to purchase shares in Thomas Cook Group in 2012 for our high risk Alpha portfolio at 14p per share. Eighteen months later the shares were at 170p, not quite the 5,000% return from a bet on Leicester City but a healthy 1,000% return nevertheless.

The catalyst for the decision was the hiring of Harriet Green as CEO with a mandate to breathe new life into the ailing travel company. Funnily enough, Thomas Cook was founded in Leicester in 1841 and grew to become the leading travel brand in the UK.

However, by 2012 the company was overly indebted, had not embraced online services and had too high a cost base. Green, like Claudio Ranieri, changed the team and brought in new tactics. Unprofitable branches were closed, online technology was introduced and new holiday products designed. The result was a leap in profitability, a restored balance sheet and happy shareholders – Prospect’s clients amongst them!

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James Penny, investment analyst, TAM Asset Management, London

Leicester city’s victory is being hailed as a total upset for the bookies, a 5000-1 triumph against the odds. I can only imagine in the locker room it was anything but. We have to remind ourselves this victory was stretched out over 38 hard fought games. To us at TAM Leicester’s victory is a story about digging in when the going gets tough and taking things one game at a time.

The market has hit investors with some pretty big shockwaves over the past decade, from the implosion of Lehman’s to central bank intervention that’s had economists ripping up the text books.

When asked about our most unbelievable achievement it is not found in one signal buy call or being heavily overweight a sector at the perfect moment but more in the relationship we have developed with our clients over time that’s enabled us to dig in deep, stick to our guns and keep growing returns through thick and thin.

Like Leicester’s season It’s been a roller-coaster and it’s far from over so before we loft the trophy we have some more hard fought games to win.

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Scott Baikie, senior portfolio manager, Thomas Miller Investment, Edinburgh

Portfolio managers need little encouragement to talk about their achievements. I imagine there was a stock of willing contributors to this editorial. Joking aside, investments are made on the back of knowledge, expectation and a smattering of hope. It is a rare thing indeed to initiate an against-the-odds investment. They go by a different name – speculation. Leicester City to win the Premiership was nothing short of an enormous punt. Occasionally, very occasionally, they pay off.

To date, becoming a CFA charter holder has been my biggest (professional) achievement. With hindsight, this was a genuine against-the-odds investment. The old adage - if you knew what was actually involved, you never would have started – ring true. My first son’s arrival just two months before taking the plunge unquestionably ratcheted up the odds of completion. However, improbable though it had been, exactly thirty months later I emerged successful, a little more knowledgeable and a little greyer.

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Andrew Gilbert, investment manager, Parmenion, Bristol

Government Bonds!

Over the last few decades, we’ve seen the yield on the 10 year UK Government bond fall from almost 8.81% in September 1994 to 5.1% in September 2000 and 3.6% in September 2009.

Over this period, many prominent fund managers and market commentators have projected a significant widening in yields back to historic trading ranges, yet we’ve remained invested given elevated levels of macro uncertainty and that UK Gilts are one of the few negatively correlated asset groups when sentiment significantly worsens.

In February 2016, the yield fell to 1.34% on the back of recession fears in the US, the lowest it’s been since 1990! The return over this period has unbelievably rivalled most equity markets with half the volatility and drawdown! Surely, this has to be an investment against the odds! The golden question then is what happens next?

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