Peter Hargreaves strikes gold for the second time with new investment management venture

Ian Orton, 09/09/2020

Peter Hargreaves, the co-founder of Hargreaves Lansdown and one of the UK’s richest individuals, appears to have hit the mother lode for the second time.

Back in 2017 Mr Hargreaves, who had a fortune worth £2.4 billion at the end of 2019, established a new investment company called Blue Whale Capital LLP along with Stephen Yiu, a former Hargreaves Lansdown employee.

This launched the LF Blue Whale Growth Fund, a global equity vehicle in August 2017 seeded with Mr Hargreaves’ capital.

And although it still had only £520 million at 31 August 2020 it has outperformed both its peers and benchmarks by a substantial margin during each of its first three years.

At the end of August 2020 it had posted a total return of 75.9 percent compared to the 25.7 percent percent returned by the Investment Association’s (IA) global category, an outperformance of 50.2 percentage points.

On an annualised basis it has generated returns 24.0 compared to the 7.0 percent generated by its IA peer category, an outperformance of 14.0 percentage points.

Stephen Yiu

Like some of its better known, and much larger peers such as the Lindsell Train Global Fund and Terry Smith’s Fundsmith Equity Fund Blue Whale invests in a concentrated portfolio of fast growing “quality” companies on a global basis.

More specifically the firms it selects for inclusion within its portfolio must have the ability to grow and improve profitability over the longer term as well as a current valuation that is attractive relative to its future growth and profitability.

Perhaps not surprising technology (60.8 percent) and healthcare (14.8 percent) companies dominate the portfolio with the US accounting for 72.2 percent of the overall allocation.

Adobe, Autodesk, Boston Scientific, Dassault Systems, Facebook, Mastercard, Micrisoft, SAP, Stryker and Visa account for the ten largest holdings.

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