Our investment approach

Consistent investment performance comes from a combination of disciplined process, technical expertise and market experience. The team managing your money is itself part of a much bigger team that works to ensure that every client gets the very best investment management possible.

We have five investment priorities:

  • Creating a portfolio that successfully matches your needs
  • Ensuring your money is in the right place at the right time
  • Careful stock selection
  • Safeguarding your wealth with strong risk management processes
  • Being clear and transparent

We have invested heavily in research tools and software to help us understand your attitude to risk and to construct portfolios closely aligned with your requirements. These tools enable us to stress-test portfolios to see how they might perform in different market conditions so we can identify the optimum blend of assets for you.

Where you have ethical concerns we use a market-leading specialist research database to ensure that holdings meet your ethical standards.

It has been demonstrated that the key driver of investment performance is “asset allocation”. Essentially, this is how your wealth is spread across different asset classes – like equities, bonds, property, commodities and cash – and which parts of the world you are invested in at any one time. One year UK equities might be the best-performing asset class in the world, another year they might be the poorest. So asset allocation has to be constantly reviewed.

We have four broad, long-term mandates that provide a framework on which to base the most appropriate bespoke strategy for each client. The asset allocation team meets monthly – and more frequently if necessary – to review and set our strategic and tactical asset allocation for each mandate. Members examine macro research, fund manager surveys, fund flows and economic cycle evaluations to identify the best areas in which to invest your money.

A key objective for many clients is that we preserve their assets in real terms (after inflation and costs). Many are willing to accommodate a degree of investment risk to seek growth too. Equities have traditionally best achieved both these objectives over the long term. Company sales and profits tend to go up as the price of goods and services rises, which mitigates the threat of inflation. Good companies reinvest cash flows into high-return activities so they grow and can also return any excess to shareholders in the form of dividends.

As a consequence, diversified global equities usually form the core of our portfolios. We are distinctive in building portfolios with a significant proportion of direct equity holdings. Screening, technical analysis, secondary research, industry contacts and conferences flag up stock and fund ideas, which are then thoroughly researched by the James Hambro team before we invest. We take into account features including:

  • Business strength and growth market opportunity: We like companies that can sustain a high return on capital, operating in markets that benefit from long-term drivers of demand.
  • Barriers to entry: We look for companies with assets that are difficult to replicate, such as brands, licences and patents, or companies that sell goods or services that are mission-critical, embedded in customers’ day-to-day lives and working practices, or involve high switching costs to replace.
  • Recurring revenue: Companies that have a high level of recurring revenue can provide stability during periods of economic weakness.
  • Prudent debt: We prefer companies with limited levels of debt relative to their ability to generate cash, in case economic conditions deteriorate.
  • Great management teams: Wherever possible we meet with the Chief Executive or Financial Officer of each company to understand their strategy.
  • Value: We always look for fair value. Often we will find companies that we feel are undervalued, where structural changes taking place within the business and an improving market have gone largely unnoticed.

We apply the same philosophy to the selection of investment funds (whatever the asset class) as we do to individual companies. We stress the importance of meeting senior managers face to face and monitor performance closely.

Other asset classes, like government and corporate debt, commercial property, commodities and cash, can provide income and reduce risk and volatility within your portfolio. Indeed, there are periods, often prolonged, when market conditions dictate a greater consideration of these options.

Whatever we invest in we want it to be liquid ­– in other words, it can be traded so we can move quickly to reduce risk if circumstances dictate. This also helps reduce the chances of your money being trapped.

The critical disciplines of asset allocation and stock selection are managed centrally, with portfolio managers given leeway to make investment choices from within our recommended list. We involve as many of our portfolio managers as is practical in meetings with company and fund managers so that everyone understands our reasoning when we take the decision to add or remove a stock or fund from lists. Encouraging wide debate and consensual decision-making helps ensure that every client gets our best ideas within their portfolio.

We closely monitor every client portfolio to ensure it is adhering to our investment principles and continues to match your agreed risk parameters.

We do not just monitor your portfolio, but also the companies within it. We engage actively with the managements of the companies we invest in. You can read our engagement policy here.

Sustainability is at the heart of our investment approach. Read our guide to see how we incorporate wider principles of sustainability within our investment process.


When we set up your portfolio, we identify and agree realistic and representative benchmarks against which you can measure our performance. Within your quarterly reports we can deliver attribution analysis that shows how that performance has been achieved – whether from good stock selection or asset allocation. Historically both have been powerful drivers for us.

We also share performance data with a number of independent organisations so that you can test our success against that of our peers to put it into context.

We are just as transparent about fees and costs. This ensures that you always know where you stand and can see clearly that we are delivering value for money.


The above should not be construed, or relied upon, as advice. Past performance is not a reliable indicator of future performance. See our important information.

The value of your investments and the income received from them can fall as well as rise. You may not get back the amount you invested.

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