Being able to sell something you do not own for your own gain is a peculiar yet very accepted part of our industry and something that, in the case of at least one UK equity fund manager, is a huge differentiator.
Rather than buying more of what he likes when positive opportunities arise, Columbia Threadneedle’s portfolio manager Chris Kinder benefits from shorting stocks he does not like whenever he sees the right opportunity to do so.
Here, he explains how the analysis of companies, their fundamentals and valuations combine for him to identify where valuations “do not stack up with what is going on on the ground”.
He also gives some flavour to why he has recently increased his short book – that has averaged around 16% short since he took on the fund at the end of 2010 – and where the challenges and therefore opportunities are ahead.
