Troy manages three funds, but the philosophy behind each one is the same. Its first and ultimate aim is to try and preserve capital; it is therefore a cautious investor by nature with an absolute return mindset.
The firm aims to deliver real returns, meaning growth should be in excess of the rate of return from cash and the rate of inflation.
The group’s chief investment officer Sebastian Lyon says that rate of growth makes its funds more appropriate for private investors than a relative outperformance, where the fund would only be tasked with beating a hypothetical benchmark.
Flagship fund Troy Trojan has a focus on sheltering capital, and Lyon invests not just in equities, but government and corporate bonds, gold and cash. This means the fund tends to have a low correlation to global equity markets because it invests in a range of assets.
Performance of fund vs sector over 10-yrs
Source: FE Analytics
Since its launch just over 10 years ago, returns have been exceptional. This can be attributed in part to the manager’s asset allocation. Lyon's stock picking also stands out as one of the best in the fund management universe. Because of the aforementioned focus on sheltering capital, the fund adopts a naturally defensive stance.
This is a tried-and-tested approach and one that should reward investors over the longer term, particularly those looking for a fund that is more cautious by nature.
In the last five years it has significantly outperformed its Balanced Managed sector, returning 52.45 per cent compared to 18.6 per cent.
That’s no mean feat for a fund not wanting to take unnecessary bets.