CIS Sustainable Leaders Trust is a UK growth fund that focuses on the core sustainable investment approach. The fund was launched in June 1990 and has achieved top-quartile performance over five years (to 30.04.10).

Mike Fox is Senior Fund manager of both the Sustainable Leaders and the Sustainable World Trusts and Head of UK Equities at The Co-operative Asset Management. Mike has managed CIS Sustainable Leaders Trust since November 2003. Prior to this, he was deputy fund manager on the Co-operative Pension Fund for two years, before which he worked as an investment analyst. Mike won Citywire’s 2007 award for “UK Growth Fund Manager of the Year”.

A thematic approach

Our Research team identifies key themes and trends and then, working with the fund manager, drills down to company level to identify long-term investment opportunities. In particular, they look for mispriced securities within the investment universe that have the potential for future rerating. In common with his colleagues on The Co-operative Asset Management’s investment team, Mike focuses on the longer term, and will typically hold an investment for an average of four to five years, significantly longer than the industry average.

Fund facts

Manager name & location	Mike Fox, Manchester
Fund launch date	29/05/90
Risk rating	Balanced
Base currency	GBX
Type of share	Distribution
Distribution dates	Jan,Jul
Fund size (as at 31/03/10)	£273 million
Distribution dates	January, July
IMA sector	UK All Companies
Annual charge	1.50%
Initial Charge	5.00%
ISIN	GB0001615102

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A concentrated portfolio with a focus on quality and value

The fund is relatively concentrated, and usually contains between 40 and 50 holdings. Because the portfolio is concentrated, Mike prefers to avoid high risk investments. Risk is assessed at individual company level, supported by the investment team’s extensive and detailed analysis.

The top ten holdings usually make up about 40% of total assets within the fund. He looks primarily for companies that display better long-term prospects for growth than the broader stock market. Companies within the portfolio tend to be leaders in their field, with credible managements and strong business franchises. Quality is an important factor, and valuation is crucial.

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A sustainable approach

In common with The Co-operative Asset Management’s general investment ethos, Mike Fox follows a sustainable approach to portfolio management and stock selection. Infrastructure is a particularly exciting long-term theme. At present, billions of people in emerging economies are still without running water or electricity; however, many of these countries are now in a position to pay for this infrastructure to be developed. Another key theme is healthcare and its relationship to world demographics, an issue that that Mike believes will become increasingly relevant over the next decade.

Every holding has to meet key criteria with regard to The Co-operative Asset Management’s sustainable approach; nevertheless, Mike only considers themes that are likely to have a material impact on valuations, and holdings that are likely to have a material effect on performance.

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