Outside the world of activist investing, there aren’t many fund managers who specialise exclusively in blue-chip companies that are widely seen as ‘dogs’.
Marketing bears some responsibility. Quality and growth narratives sell not only because it is easier to point to fast-expanding, high-margin companies than ones with thin profits and untapped value, but because they offer a halo of credibility by association to a fund manager.
As they used to say both in MBA textbooks and on Wall Street, “no one ever got fired for buying IBM”. Or at least they didn’t before 2013, since when the once-standout technology stock has gone sideways in a decade in which its average S&P 500 sector peer rose 335 per cent on a total return basis.