Co-managed by Ian Lance alongside Nick Purves, TMPL is a prominent UK equity income fund best known for its value-investing approach. Focused on income and long-term growth, it targets investments in undervalued areas such as financials, energy, and turnaround situations, which has helped it deliver returns far in excess of the UK investment company average, including a 19% return in 2024, more than double the 9.5% return from the FTSE All Share. The company can invest up to 30% of its portfolio overseas but is currently weighted more to the UK given the managers’ belief in the value its markets offer.
In this podcast, Ian explains how the trust’s bottom up investment approach has driven the fund’s performance, and how corporate share buybacks and takeovers have proved a catalyst for improved returns; why the company seeks out turnaround stories, and why its successful contrarian investment in retailer Marks & Spencer has further to run; how the company manages economic cyclicality and the deteriorating UK economic outlook, and why periods of economic distress create opportunities as other investors overreact to bad news; the importance of starting point valuations as a foundation for future outperformance; and why the managers remain optimistic about the company’s prospects in 2025, citing the persistently low valuation of UK equities and the portfolio’s high dividend coverage.
