Asset Manager Overview
Based in Henley-upon-Thames, Invesco is one of the largest investment management groups in the UK and is part of the Invesco Ltd Group (founded in 1973), a leading global investment manager listed on the New York Stock Exchange.
Invesco's specialised investment teams manage investments across a comprehensive range of asset classes, investment styles and geographies. They focus on client needs globally, whilst retaining a close proximity to ensure a strong relationship. Invesco hold a long-term strategy for both their clients and their own business. The company offer strategies across the full spectrum of asset classes, and can be tailored directly to the needs of their clients. As well as equities, bonds and real assets, Invesco also have multi-asset strategies and liability-driven investments. Invesco UK (previously Invesco Perpetual) manages assets on behalf of individual clients, fund platforms, nominees, pension funds and corporate institutions.
Fund Manager/Team Overview
The fund is managed by Rhys Davies, who is based in Henley and has been a member of the team since 2003. Mr Davies is a fund manager and senior credit analyst and has been managing money since 2014. He became co-manager of this fund in August 2020. Ciaran Mallon continues to select stocks for the majority of the equity component of the fund, which he has contributed to since October 2013. Mr Mallon has been a member of the UK Equity team since he joined Invesco in 2005 and is a seasoned UK equity investor. Effective as of March 2nd 2026, Samir Patel will be added as a co manager alongside Mr Davies and Mr Mallon. Mr Patel has held a number of credit analyst roles, including at Lazard and Oppenheimer, and joined Invesco in 2018. In addition, the managers can draw upon a team of credit, equity and risk analysts, as well as the wider vast resources of Invesco.
Investment Philosophy & Process Overview
The team's investment philosophy is built upon the premise that markets are mostly efficient, but also present opportunities. This may be due to markets overshooting, moving prices away from fundamental value, because of the different objectives of investors, or their constraints. The managers attempt to exploit such inefficiencies through fundamental analysis with a strong emphasis on valuation, assessing potential risk vs potential return across fixed income markets and equity markets (max.20%). The process is designed to be flexible and can change depending on market conditions, recognising that different risk factors drive markets at different points in time.
The investment process combines four elements: macroeconomic analysis, fundamental company analysis, value assessment and risk considerations. First is the top-down economic analysis, seeking to understand the macroeconomic environment which enables the team to make informed forecasts of future conditions. This work focuses on the path of interest rates and trends in the pricing of risk. These views then form the foundations for the positioning of the fund, including asset allocation, interest rate sensitivity, yield curve positioning and corporate credit risk.
Having decided how they want to be positioned from a broad risk perspective, the managers then turn their attention to bottom-up stock selection. At this stage, they assess whether a company can meet its obligations in terms of interest and principal repayment of debt. Various measures are examined, including the extent of a company's gearing, its earnings and its financing costs, with an emphasis on how these measures are evolving through time. This should result in a thorough understanding of risk, enabling the managers to create a portfolio where they look to maximise returns from acceptable and well understood risk exposures.
The third step in the process is to assess value, and to judge whether the potential returns of a security sufficiently justify the risks, both on an absolute basis and relative to cash, core government bonds, and the rest of the fixed income universe. This should enable the managers to identify and invest in the bonds which offer the best returns on a risk-adjusted basis, within the set parameters of the fund.
Finally, risk considerations are considered, analysing all holdings to allow for a comprehensive understanding of the risks involved to ensure diversification of the portfolio.
Mr Davies is responsible for the bonds in the portfolio and also makes equity allocations in instances where the equity of a company offers an attractive valuation relative to its bonds, as well as investing directly via index derivatives when broader equity markets are deemed attractive. A small additional portion of the equity allocation is managed by Mr Mallon and the fund can hold up to 20% in equities. Currency exposure is usually hedged to sterling. Derivatives may be used both for hedging and investment purposes.