Quoted Equity

We believe you build wealth by owning companies, not trading them on the stock market.

Focused on ‘co-owning’ companies that are built on solid foundations and generate cash, we target businesses that we understand and that can deliver good returns on capital. We tend to find these companies within technology, healthcare and life sciences equipment and services, industrials and consumer goods.

In our search for underlying predictability and pricing power, we look for factors such as a strong brand, scalability, repeat business and a strong market position.

The strategy has two key objectives, firstly to provide exposure to individually excellent companies for a long period of time to gain long-term economic benefit. Secondly, to hold these in a combination that creates a relatively resilient equity portfolio.

Holdings & performance – Capital

Holdings & performance – Income

The Quoted Equity strategy is split into two portfolios: Capital and Income.

The portfolios contain significant holdings in well managed companies, held for the long term. These investments typically offer substance, brand, intellectual property and strong market position.

Introducing Quoted Equity

We are not traders of stocks; we are long-term owners of companies.

Watch film

“The Quoted Portfolio is a risk managed, concentrated collection of high quality companies which we can hold for long periods of time. We always invest with a margin of safety, using general stock market volatility for entry points and to make sure we are being careful with our shareholders’ money.”

Mathew Masters

Head of Caledonia Quoted Equity

Meet the Quoted Equity team

Combined portfolio performance data

Over 1 Yr

Over 3 Yrs

Over 5 Yrs

Absolute Return

-0.3%

13.5%

28.8%

Annualised Return

-0.3%

4.4%

5.0%

as at 31 March 2020

Capital Portfolio

The Capital portfolio comprises investments in well-managed, publicly quoted companies, held for the long term. We select mature, enduring businesses that have a significant presence in their market – and where assets consistently produce strong returns on capital, enabling reinvestment and growth. Our objective is to deliver a 10% annual return, with no income constraint.

Performance Data

Over 1 Yr

Over 3 Yrs

Over 5 Yrs

Absolute Return

1.3%

27.0%

42.4%

Annualised Return

1.3%

8.3%

7.3%

as at 31 March 2020

Holdings

Ten Largest Holdings

Value (£m)
31 Mar 2020

Microsoft

39.8

Oracle

37.1

Charter Communications

32.0

Becton Dickinson

27.0

Spirax Sarco

26.0

Watsco

24.9

Thermo Fisher Scientific

24.8

Texas Instruments

23.1

Polar Capital

21.9

AG Barr

20.9

British American Tobacco

20.7

Hill & Smith

20.5

318.7

Remaining holdings

105.9

Total

424.6

as at 31 March 2020

Geographic distribution

64%

                            North America
                                                
33%

                            UK
                                                
3%

                            Europe

Sector distribution

24%

                            Industrials
                                                
24%

                            Technology
                                                
17%

                            Consumer goods
                                                
16%

                            Healthcare
                                                
8%

                            Telecoms
                                                
6%

                            Basic materials
                                                
5%

                            Financials

as at 31 March 2020

Income Portfolio

The Income portfolio is constructed using similar quality criteria as the Capital portfolio: we invest selectively in mature, long-term businesses with resilient business models and the capacity and management culture to pay sustainable dividends. Our objective is to deliver a 7% annual return, with an initial yield of 3.5% based on the cost of investment. However, once invested we will not sell down positions simply based on dividend yield, as this will fall as a result of share price growth. Our underlying strategic aim is to invest in good quality companies whose progress over time will grow the absolute amount of dividend ahead of inflation.

Performance Data

Over 1 Yr

Over 3 Yrs

Over 5 Yrs

Absolute Return

-3.8%

-10.5%

4.3%

Annualised Return

-3.8%

-3.6%

0.8%

as at 31 March 2020

Holdings

Top Holdings of more than £10m

Value (£m)
31 Mar 2020

Yield %

Sabre Insurance

15.3

4.5

Pennon Group

14.6

2.5

Unilever

13.1

3.5

National Grid

12.4

5.4

British American Tobacco

11.9

6.5

Direct Line Insurance

10.1

2.7

77.4

Remaining holdings

72.0

Total

149.4

6.2

as at 31 March 2020

Geographic distribution

78%

                            UK
                                                
16%

                            North America
                                                
6%

                            Europe

Sector distribution

29%

                            Financials
                                                
26%

                            Consumer goods
                                                
21%

                            Industrials
                                                
18%

                            Utilities
                                                
6%

                            Technology

as at 31 March 2020

Our geographical analysis reflects listing location.