He has chosen to avoid investing in mining stocks, the energy sector and financials, arguing that quality consumer companies like Unilever have better pricing power and returns on capital, which are crucial in a deflationary world.
Despite being hurt by the cyclical rally and reflationary trade post-US election, on a quarter-to-date basis, the Global High Quality fund has returned 6.7% compared with the equity international sector’s 4.3%.
“We would rather try to see where we could buy back a name like Accentra or Automatic Data Processing (ADP) as opposed to wondering when the next cyclical bounce will be,” he said.
