From backing Gates to minding the Gap

My favourite investment: Tips from a City expert
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The Independent Online

Katherine Garrett-Cox looks after all US investments at Hill Samuel. With her team of seven, including five fund managers, she isresponsible for more than £2.5bn worth of investments.

Katherine Garrett-Cox looks after all US investments at Hill Samuel. With her team of seven, including five fund managers, she isresponsible for more than £2.5bn worth of investments.

Like many graduates, Katherine Garrett-Cox stumbled into fund management because she liked the people and the set-up. But once shestarted work at Fidelity she discovered a much more compelling interest: US equities. "Now I never want to change. I always wanted todo something that I would enjoy, and what's better than following the biggest and most exciting stock market in the world?"

Her investment tip is to look at the strength of a firm's management."This is the most important factor. We always look for leaders intheir sector with strong brand positions, a good and consistent performance record and, hopefully, undervalued future growth prospects."

She always meets the managers of a company before investing in it. "Then we'll have a follow-up meeting once or twice a year. My teamsees around 700 companies a year. But when we invest, we expect to keep the holding for at least two or three years if not longer."

Her biggest holding is Microsoft, which accounts for just under 5 per cent of the £87m Hill Samuel American Growth fund. Thiswas the first stock she bought for the unit trust. "Back in 1993, few people in London were buying into the company. I purchased theshares at the equivalent of $10 (£6.40) each. Now they stand at nearly $100 and the group is valued at $470bn, making it thelargest company in the world."

A more recent investment has been Gap. She bought into the retailer at the beginning of the year at the equivalent of $45 a share. Todaythe shares stand at around $60.

"In the past, Gap was not too shareholder friendly. The managers were too busy running their tight ship to see potential Europeanshareholders. Now they have changed their attitude. I believe the company has a great future. Its management is first rate, it is growinginternationally and has accelerated its earnings, and it has a strong strategy for selling over the internet."

Her personal investment portfolio consists largely of investments in the unit trusts she manages. But Ms Garrett-Cox has also bought aboat. "I bought the catamaran as a pres- ent for my husband, but it's my best investment in terms of satisfaction and enjoyment. It costjust over £5,000.

"While I know it will probably depreciate in value over time, I still hope that when we trade it in for something bigger and better it willshow a profit."

Who's who: Katherine Garrett-Cox

Age: 31.

Studied modern history at Durham University.

Worked for Fidelity before joining Hill Samuel six years ago.

Her speciality is large companies.

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