Patience and discipline

STAR MANAGERS SPECIAL

Perpetual

Perpetual Wholesale Smaller Companies Fund

Jack Collopy (portfolio manager)

It is all about the discipline of the investment process and patience at times, according to Jack Collopy, the portfolio manager of the Perpetual Wholesale Smaller Companies Fund, who has been recognised as one of the Financial Newswire Star Managers.

Collopy has more than 21 years of experience, which includes his 19-year tenure at Perpetual, where he joined in 2001 as an investment administrator and equity dealer. After four years he moved into an analyst role, focusing on small cap industrial companies and took on portfolio management responsibilities in 2010.

The fund’s investment objective is to provide long-term capital growth and income through the potential to benefit from the growth of quality smaller and emerging companies through a proprietary stock selection process and active management.

The fund follows the investment philosophy which focuses on rigorous bottom-up research and engagement with management, which is of particular value when it comes to smaller companies.

This also means that the team invests in a company only when they believe the share price is attractive relative to its return potential and seeks to hold the positions long-term, provided that the quality of the business remains unchanged and the price remain attractive.

“We only invest in profitable companies. We are never in the market darlings or things that go up 10 times in a year, we have never had those stocks. We really focus on rule number one, not losing money,” Collopy said.

Speaking on the key differentiators of his fund, Collopy said the fund tended to focus on and stick to the core values of investments and “we don’t venture out into places where our process does not let us”, he said.

This would include things like concept stocks, resources explorers or high revenue multiple businesses, among others.

When asked what makes a good portfolio manager, Collopy said: “There is a few things: discipline around the process, patience at times, natural curiosity, self-awareness around fear and greed as well as recognition of the quality of companies we are investing in, these are the things which are  non-quantifiable.”