The Premier Sanford DeLand UK Buffettology Fund 

“There are large forces at work that buy and sell huge amounts of securities. And they couldn’t care less about the economics of the businesses that they are buying and selling. And sometimes these forces go entirely out of whack and create wonderful opportunities for business perspective investing … Fools and greed usually go hand in hand, which creates a field of opportunity for the rational man.” 

Mary Buffett & David Clark, ‘Buffettology’, 1997  

Objective of the Fund 

The main objective of the Premier Sanford DeLand UK Buffettology Fund ('the Fund') is to achieve a superior annual compounding rate of return over the long-term, defined as between five and ten years, by investing mainly in the equity of UK businesses with strong operating franchises and experienced management teams. These may be either Fully Listed or quoted on AIM. The investment manager applies the philosophy and techniques of Business Perspective Investing. These principles are set out in more detail in the section of this website entitled ‘Our Methodology’ .  

Portfolio Composition 

We regard conventional portfolio diversification as a protection against ignorance. Therefore, the Fund will adopt a focused approach to investing and will typically own around 35 holdings in appropriate companies. It is worth pointing out that index tracker funds can have as much as half their net worth invested in the shares of less than half this number of companies, which makes them at least as concentrated as the Fund is likely to be.   

The opportunity for investors of focused investing is neatly summarised thus by Warren Buffett: “A lot of great fortunes in this world have been made by owning a single wonderful business. If you understand the business, you don’t need to own very many of them.” ¹   

Structure of the Fund 

The Fund is a sub-fund of an umbrella Open Ended Investment Company (OEIC) called Premier Castlefield Funds. An OEIC is a collective pool of investors' capital, which can be invested in a wide range of investments such as shares, gilts, bonds, exchange traded funds or cash deposits. The size of an open ended fund varies according to the forces of supply and demand for the units or shares in it. Investment in an OEIC buys a share of the fund giving proportionate ownership of the underlying investments in the fund. The share price of an OEIC therefore varies with the total value of the fund, which, in turn, is determined by the market value of the underlying investments.   

To cover the costs of running a fund, there is usually an initial charge when shares are purchased by investors in the fund, and an annual fee for ongoing costs such as the manager’s fee and administration costs. In this case the initial charge is 5% - currently reduced to 2.5% for direct applications - and the investment adviser’s fee is 1.5% per annum. Other charges apply for third parties' services to the Fund, e.g. the Authorised Corporate Director, Depository, Administrator & Custodian and Auditor. Full details can be found in the Prospectus. Investments in the Fund can be made directly into it or through an ISA (Individual Savings Account) or SIPP (Self-invested Personal Pension).   

The Authorised Corporate Director (ACD) 

This is Premier Portfolio Managers Limited (Premier). Like any ACD, Premier is responsible for administering and managing the company’s affairs, on behalf of shareholders and in accordance with FSA regulations.   

The Investment Adviser 

This is Castlefield Investment Partners LLP (CIP), an FSA authorised and regulated business. Under an agreement with the Authorised Corporate Director, Castlefield has the delegated authority to manage the assets of the Fund, in accordance with the prospectus and subject to the oversight of other parties.  

The Investment Manager  

As the Investment Adviser, Castlefield has appointed Keith Ashworth-Lord of Sanford DeLand Asset Management Limited (SDL) to manage the Fund on a day-to-day basis. SDL is an Appointed Representative of Castlefield and Keith Ashworth-Lord is an Approved Person of Castlefield.  

The Depositary 

This is Royal Bank of Scotland. Subject to FSA Rules and OEIC regulations, RBS is responsible for the safekeeping of the property of the company.  

The Administrator and Custodian  

This is Northern Trust. It handles the day-to-day work of pricing the Fund, recording purchases and sales of underlying investments and dealing with investors buying and selling shares in the Fund itself. The assets of the Fund are held in a nominee company operated by the custodian (Northern Trust), but they are held to the account of the depository (RBS). The Depository is not permitted to be the Custodian as well.   

The Auditor 

This is Grant Thornton UK LLP    

References: ¹ Warren E. Buffett, Speech to the New York Society of Security Analysts, 6 December 1996

Please note that Warren E. Buffett does not endorse or sponsor the Premier Sanford DeLand UK Buffettology Fund.