At face value, the positions in the Schroders Global Recovery Fund may look very different, but they all have a similar thread, and that’s that people are scared. Nick Kirrage, Portfolio Manager, says they exploit human psychology in order to have a process that works, regardless of the macro environment.

“Value investing, at its heart, is just using bad headlines to make great investments.”

Watch the video below to find out why he expects to see at least one portfolio holding per year go bankrupt, and why that’s a good thing.

Key points

• Lessons to be learnt from being a contrarian investor.
• This strategy requires long-term thinking as investments are purchased with a 5-year view
• He discusses the example of Anglo American, which fell 50% after purchasing, before rallying over 400% in the next 17 months.

Further information about the Schroder Global Recovery Fund can be found here