Boy conkerer switched to battles for growth

The Fund Manager

Ask a typical child what they want to be when they grow up, and "fund manager" is not likely to be top of the list. But for Jonathan Bell, the skills necessary for a successful City career showed early.

When he was six he used to swap toys in the playground. "My classmates were keen to follow the latest crazes, but I was only interested in getting something worth more than the item I was swapping," he says. "During the conker season, I would collect diligently at the weekend and play furiously, so by the middle of the week, I could sell my most successful conkers at a premium price."

His first taste of successful financial dealing came in his early teens, when he was at a school where pupils had to buy lunch tokens in the morning before they knew what was on the lunch menu. "The tokens cost 25p and came in a variety of colours so only that day's colour could be used that lunchtime.

"When the menu was unpopular, I would offer to buy tokens back at 20p and would sell them on again for 30p on days when fish and chips were on the menu. I can remember telling my father he need not increase my 5p a week pocket money, as I was making more in the day at school. It was not the money I was after, but the satisfaction of creating value."

Taking an interest in the stock market was a small step. By 15, he was running a "dummy" portfolio of shares quoted in the school's copy of the FT. He gained his first direct experience of investment via a holiday job as a City messenger, through the broker father of a school friend, and maintained his interest at university, by investing his first grant cheque. "I bought units in a special opportunities unit trust with the £200 and within a few months had increased the value of my grant by more than £50."

With a degree in economics and politics, and an MBA from Cranfield School of Management, Mr Bell joined the private client department of BZW just before the crash of October 1987. He moved to Newton in April 1996 and took over the Newton Bridge Fund. "We relaunched after the initial investors liquidated their holdings," he says. "We had what was effectively a shell in existence and we had to decide what we wanted to do with it. We decided to offer a new service to our wealthiest clients.

"We suggested to some of our larger private clients that we pull all their funds together in one vehicle. They would get the same underlying investments and there are certain tax advantages to being invested in a unit trust, plus they continued to get all the services normally associated with a discretionary managed portfolio."

The trust has a high minimum investment. "The set minimum is £100,000 and while we are happy to manage investments from that level, the lower rate 1 per cent initial charge applies on investments only of £500,000 or more, so that is a more practical level."

He adds: "The way we run money at Newton is consensual. If I buy a stock for one growth client's portfolio it is more than likely it will be suitable for all of them. The Bridge Fund invests broadly in line with Newton's model portfolio for sterling-based investors seeking long-term growth.

"We aim to identify investment themes as they emerge and move across the globe, for example the impact of new technologies, changing demographics and the increasing globalisation of industries and brands. But 55 per cent of the portfolio is in UK equities, and the cash and bond elements held to diversify risk are also predominately in sterling."

The portfolio also has 12 per cent in Europe, 10 per cent in North America, 5 per cent in the Pacific markets and 4 per cent in Japan. The rest is split between fixed interest and cash.

Recent performance has been generated by a pragmatic approach to the major growth themes. "We have scored through being overweight in Europe and the US and the focus of our US investments has been on technology, through companies such as AT&T and Sun Microsystems.

"We have avoided the dot.com businesses, but the technology infrastructure is still going to be built and we are very keen on that area. We also moved into utilities, like Severn Trent, which is now one of the major holdings in the fund, at a good time. It is quite a growth orientated portfolio, but we are also looking for value when we buy growth.

"We have also been very keen on banks that could make the most of the new delivery channels, such as phone systems and the internet, so Bank of Scotland has been our major bank holding.

"That hasn't really worked out yet and we would have done better to rely on traditional banks whose customers have proved more loyal.

"But we are sure the more innovative banks will come back into favour."

Fundamental Facts

Fund Manager: Jonathan Bell

Age: 35

Fund: Newton Bridge

Size of Fund: £157.8m

Fund Launched: February 1994

Manager of Fund: Since November 1996

Current Yield: 1.59%

Initial Charge: 6.00% (Drops to 1% on investments of £500,000)

Annual Charge: 0.8%

Current Bid/ Offer Spread: 6.00%

Minimum Investment: £100,000

Minimum Monthly Savings: n/a

Standard & Poor's Micropal Rating (maximum *****): ***

Fund Performance(to 10 April 2000): (Offer-to-bid, with net income reinvested)

One Year 4.73%

Two Years 15.91%

Three Years 51.93%

Since Relaunch 66.87%

Five Years 104.05%

Since Launch 82.42%

Source: Standard & Poor's Micropal