At Richmond House Investment Management we adopt a fund of funds approach, investing only in collective investment schemes rather than individual shares of companies.
We feel that a fund of funds portfolio is the best way to achieve a well diversified portfolio which virtually eliminates stock specific risk. In addition, by investing in fund managers whose remit is to invest in a particular sector we can be confident that each fund manager has sufficient knowledge of their asset class.
We aim to select the best of breed fund managers who have detailed knowledge of the companies that they invest in within their particular sector. However, even the best fund managers can underperform if their particular style or asset class is not appropriate for a certain point in the market cycle. We therefore maintain that no one fund manager will outperform their respective index all of the time and it is our role to identify this and invest accordingly. In order to achieve this, thorough and ongoing research into fund selection is key.