• Documentation

Investment Objectives

The Value Opportunities Sub-Fund is a sterling denominated Sub-Fund of Millais Investment Portfolios PCC plc that offers investors the opportunity of investing into a hedge fund that aims to provide positive total returns within a carefully constructed risk profile at all times.

The Sub-Fund intends to offer a distinct alternative to traditional UK investment funds. The Sub-Fund will develop a portfolio of stocks that is concentrated in stocks expected to benefit from fundamental change at industry, thematic and company level. The portfolio may be hedged from time to time against adverse market moves.
The portfolio construction will be based on an investment approach that uses specific fundamental analysis combined with accurate investment timing.

The Sub-Fund’s investment objective is to achieve consistent and positive total returns after all fund management and administration costs of the Sub-Fund. The average annualised targeted return after payment of all expenses and Performance Fees is between 10%-15% per annum.

Investment Strategy

The Sub-Fund intends to invest in a diversified portfolio of short and medium term value opportunities. The Sub-Fund will invest on a long-only basis and will not utilise any gearing.

The Sub-Fund may invest in stocks, bonds and may buy and/or write options. The Sub-fund will also invest in closed-ended investment vehicles listed on the major exchanges.

The Sub-Fund will seek to identify a range of value opportunities amongst a wide range of sectors. The opportunities will be ranked according to valuation, timing, risk, liquidity and availability of investment candidates. Capital will be allocated amongst a range of preferred opportunities and the Sub-Fund will seek out individual investment opportunities based on fundamental research and relative valuation techniques.

Investment Manager

The Directors have appointed DPZ Capital Limited (“DPZ”) to act as Investment Manager to this Sub-Fund pursuant to an Investment Management agreement dated 17th April 2009.
DPZ is an independent asset manager focused on providing absolute return style investments to a range of wealthy individuals, families, charities, trusts, pensions and institutions. Established in 2007, DPZ is a Jersey Limited company and is regulated by the Jersey Financial Services Commission.

Mike Langstone and Darren Zaman will act as the primary portfolio managers.

Mike Langstone joined DPZ as a fund manager in May 2008 from HSBC Investments where he managed a range of multi-asset class portfolios as head of Advisory Investment Management. Prior to HSBC Investments, Mike was an Investment Director with Le Masurier James & Chinn Limited having joined them in 1992 when he moved to Jersey. Prior to joining Le Masurier James and Chinn he was head of international equity and currency trading at City stockbroker’s Laing & Cruickshank.

Prior to founding DPZ in 2007 Darren Zaman was the Managing Director of HSBC Investments, following the take-over of Le Masurier James and Chinn Limited, with responsibility for the international fund management teams based in Jersey and London. At Le Masurier James and Chinn he was responsible, as Managing Director, for the investment management strategy of the company’s successful multi-asset class investment services. His career in the financial markets began in 1986 as a Eurocurrency trader in the wholesale money and foreign exchange markets before moving into stockbroking & investment management in 1993 initially as a bond and currency manager. He has extensive experience managing and advising on the investments of wealthy individuals and families, trusts, charities, pensions and institutions.

Darren has a BSc (Hons) from UMIST, holds the Securities & Investments Institute Diploma, and is an Associate of the Chartered Institute of Bankers and a Fellow of the Securities Institute.

The Investment Manager will utilise a variety of inputs to determine the portfolio of the Sub-Fund which will include company management meetings, attendance at formal company presentations, contact with and understanding of peer companies, suppliers, market data providers, industry journalists and publicly available historic information. In addition the Investment Manager will use a range of in-house fundamental and relative valuation research.

Investment Details

The Investment Manager may also use directly commissioned research or access to industry and company material, or opinion to gain further insight into potential investments.
It will be the policy of the Investment Manager to maintain a well-diversified portfolio of investments. A limit on investment in securities issued by any single issuer will be 15% of the Net Asset Value of the Sub-Fund, calculated upon acquisition, although when the Net Asset Value of the Sub-Fund is GBP 2 million or less, this limit will be 20%. Should the limit be reached as a result of changes to the stock’s value, contraction of the Net Asset Value of the Sub-Fund through redemptions, or of a rights or bonus issue, then further acquisitions will be precluded until such time as the limit is restored.

Custodian

The Fund and the Investment Manager have appointed UBS AG Jersey to act as custodian of the assets of the Sub-Fund pursuant to a Custody agreement dated 17th April, 2009.
UBS AG is the world’s leading wealth management business provider and one of the world’s leading financial firms providing private banking, investment banking and securities and asset management services to clients globally. Headquartered in Zurich and Basel, Switzerland, UBS is one of the world’s leading financial firms. It serves a discerning, international client base with its wealth management, investment banking and asset management businesses. In Switzerland, UBS is the market leader in retail and commercial banking.

UBS is present in all major financial centres worldwide. It has offices in over 50 countries, with about 38% of its employees working in the Americas, 34% in Switzerland, 15% in the rest of Europe and 13% in Asia Pacific. UBS employs more than 75,000 people around the world. Its shares are listed on the SIX Swiss Exchange, the New York Stock Exchange and the Tokyo Stock Exchange. UBS has long-term credit ratings of Aa2 from Moody’s and A+ from both Fitch and S&P.

The Custodian is regulated by the Jersey Financial Services Commission and is registered in Jersey under the Banking Business (Jersey) Law 1991 (as amended) (the “1991 Law”) in the conduct of “deposit taking business” (as defined in the 1991 Law) and the Financial Services (Jersey) Law 1998 (as amended) (the “1998 Law”) in the conduct of “investment business” and “trust company business” (each as defined in the 1998 Law). UBS AG, Jersey Branch is a branch of UBS AG, a public company limited by shares incorporated in Switzerland.

The Custodian holds (either itself or through its agents or delegates) the assets of the Share Class A – Value Opportunities Sub-Fund but has no responsibility for selecting the investments of the Sub-Fund. The Custodian may appoint sub-custodians, nominees and agents to perform its duties.

For the avoidance of doubt the Custodian is not providing directors to any part of the Fund structure and is not involved in the day-to-day management of the Fund or this Sub-Fund.

As the Sub-Fund has been constituted as a Cell by the Directors in accordance with the Protected Cell Companies Act 2004 and the Articles, the Custodian will hold the assets of the Sub-Fund (including any ordinary shares of any operating subsidiary of the Sub-Fund) for the account of the Sub-Fund.

For full details of the Sub-fund, click here.