The star fund manager has asked his investors to be patient.
Star fund manager Nick Train has asked his investors to be patient, following share price falls for some of his favourite holdings.
In a monthly update for his Lindsell Train UK Equity fund, Train noted that four of his portfolio’s big holdings suffered large share price falls: Hargreaves Lansdown (LSE:HL.), Heineken (EURONEXT:HEIA), RELX (LSE:REL) and Unilever (LSE:ULVR). All reported trading results in February.
These four shares equal around a third of the entire portfolio and each suffered a share price fall from between 7% and 11%.
- Funds and trusts for a hands-off approach
- UK equity income trusts have held the line on dividends
- Funds and trusts yielding above 5%: opportunity or value trap?
Train noted that Heineken, Unilever and RELX were all hit hard by the Covid-19 pandemic. Meanwhile, Hargreaves Lansdown’s share price fell after placing a block of shares that were sold by its co-founder Peter Hargreaves.
According to Train, investors should remain patient. He said: “I dislike having to recommend patience to fund investors, who have had to experience this virtue many months already; but I do recommend it still.”
Train pointed out that the financial results of all four firms, despite precipitating a share price fall, had some promising aspects for long-term investors. Most notably, he said, all four company’s dividend payments look positive.
Train also pointed to some companies in the fund that had performed well lately. He noted that Burberry (LSE:BRBY) gained 6% in February and is now up by 34% from its lows of last year. “To us, Burberry still looks like an excellent way to participate in wealth creation and recovery in consumer spend, especially in Asia.”
Manchester United’s (NYSE:MANU) shares were also up. Train noted that the company’s share price rose “for no other reason we can see but that fans will soon be back in stadiums”. Another strong performer was LSE Group (LSE:LSEG), which gained 11%.
- Nick Train on share tips and Buffett in The Richard Hunter Interview
- Tom Bailey Column: Help! I believe in passive but buy active funds
- Take control of your retirement planning with our award-winning, low-cost Self-Invested Personal Pension (SIPP)
Over the month (to the end of February), Lindsell Train UK Equity fund lost 0.5% versus a 2% rise for the FTSE All-Share Index.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.