If we think that the market’s too high, we’re happy to hold modest amounts of cash with the idea of future investment at a later stage. When we have a portfolio in place that we’re happy with, we use the money coming into the fund to rebalance rather than making wholesale changes. So we’ll look at things which have been out of favour for a while, and that’s where we will generally put new money into the market.

That’s our investment strategy, which is based on low turnover. We are not shifting from sector to sector on a regular basis, but we use the naturally generated cash flow to redevelop the portfolio.

Q:  What is your view on the mid and small-cap parts of the market? If you find opportunities in that area, would you be able to exploit them as part of your strategy?

A: Yes, we would still go and look at it on an individual stock basis. This part of the market has performed very well and it has beaten the large-cap part of the market for some time now. For that reason, we wouldn’t really be chasing that particular area because we think that there is better value in some of the large companies.

Q:  How large is the asset base of the company?

A: The assets under management in are about £4 billion. In this particular unit, the Wesleyan Growth Trust, we manage about £80 million.

Q: Can you give us some examples of companies that have been in the fund for more than three years?

A: If you look at the big holdings, we hold the names that you would expect to see because they are the big stocks in the index. Such names are BP, Vodafone, HSBC, GlaxoSmithKline, and that gives you an idea of the blue chip type of portfolio.

Some of the success that we’ve had recently is due to the large number of takeovers in the UK. One of the reasons why we don’t have to sell many stocks is the constant flow of money coming in from takeover bids and investment income. This year we held good positions in takeover targets BAA and Associated British Ports, and these are stocks that we’ve held for a few years. They are companies with good market positions backed by assets, and that’s why they were attractive to us.

When we bought them, many perceived them to be somewhat unexciting but we felt they were relatively attractive and sometimes you have to be patient. They don’t always perform fantastically well from the moment you put them in the portfolio, but if you’re confident that there is value is there, then that value will ultimately come through.

Q: Would you explain your buy and sell discipline?

A: Our strategy hasn’t changed over time, what changes is what’s relatively out of favour at any particular time. For example, twelve months ago the telecom sector was quite unfashionable, and the likes of British Telecom were relatively unloved, so we would add to this type of holding. Now the markets are quite strong and it is becoming more difficult to find undervalued areas.

Q: How would you deal with the situation when returns come quicker than expected? Would you sell the stock?

A: When you’re caught up in those circumstances, you’re tempted to take a profit, and occasionally we’d do it, but it’s not our basic investment philosophy. Sometimes we’ll do that, if we think its right, but it tends to be the exception rather than the norm.

Q: What differentiates you from your peers?

A: We are true long-term investors with portfolio turnover amongst the lowest in the industry. We target excellent long-tem performance with lower than average risk.