Mark Slater is one of the most successful and widely followed growth fund managers in the UK. Since setting up Slater Investments 22 years ago, he and his team have delivered an exceptionally strong performance record across their growth and income funds.
A great deal of that success is down to an unshakable focus on buying good quality growth shares at reasonable prices. But equally, it’s about really understanding the nature and likely longevity of that growth. That means recognising the traits of different growth stocks and dealing with the psychological battles of buying, holding and selling these types of companies.
Back in 1992, Mark worked with his father, the late Jim Slater, on writing and publishing The Zulu Principle. It became, and remains, one of the most influential UK-focused investment guides around. The strategy rules in the book have a common sense, yet distinctly buccaneering feel to them. Arguably, that’s precisely what’s needed in the search for the great growth stocks of tomorrow. And it’s the reason why Mark still applies them today. With that in mind, I went to meet him to discuss his approach and some of the lessons learnt from his career in investing.
A word of warning: the interview covered a lot of ground, and while we’ve pared it back to the key parts, it’s still extensive! To help, we’ve broken the interview into sections to make it easier to navigate.
Mark, what is your assessment of how markets, and growth stocks in particular, have performed in recent years?
The period coming out of the crisis has been very, very strong. A lot of companies that we’ve done well with were really bombed out back in 2008 and 2009. We were starting from a very, very low base so I think from 2009 onwards one would have expected to do pretty well.
Since the crisis our approach has been to assume that life would be tough, and I think for the average business life is very tough. Having said that, zero rates have helped and certainly it could have been an awful lot worse. But the key thing is that coming out of the crisis valuations were so low that it didn’t surprise me that a lot of companies went up multiples.
On current market conditions...
Conditions have been a little more unsettled in 2016 so far. What’s your…
