Investor Summary
Fund Strategy
FUND PERFORMANCE AS OF 31st March 2026
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 12.1% | 7% | 7% |
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 12.1% | 7% | 7% |
Kernow Asset Management delivered a defensive performance in March 2026, limiting losses to 0.7% while UK markets declined 7% and mid-caps fell 10%. The fund's contrarian approach proved effective as oil prices doubled and market conditions turned hostile amid escalating geopolitical tensions. The short book generated an exceptional 18% return on invested capital, demonstrating the value of their defensive positioning. The manager maintains their philosophy of survival first, then returns, believing they have passed the fear apex and are now accelerating with selective buying. Key portfolio actions included exiting Amedeo Air Four Plus after a takeover bid despite a 32% NAV discount, realizing more than double returns since January 2023. They also completely exited Secure Trust Bank after an 86% gain, citing lack of strategic clarity despite the bank being an attractive acquisition target. The fund continues to avoid indiscriminate buying, preferring targeted opportunities while maintaining their concentrated long/short approach across UK equities.
Kernow Asset Management employs a contrarian long/short UK equity strategy focused on asymmetric return opportunities where investment thesis differs from consensus, prioritizing capital preservation during market stress while selectively deploying capital when opportunities arise.
The manager believes they have passed the fear apex and are accelerating, with selective buying continuing. They maintain their contrarian approach, focusing on survival first then returns, expecting markets to eventually reward courage after paying for caution.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 13 2026 | 2026 Q1 | RR.L, STV.L | Airlines, Banking, contrarian, Long/Short, oil, United Kingdom | - | Kernow's contrarian UK long/short strategy delivered strong defensive performance in March, losing only 0.7% versus 7% market decline. Short book generated 18% returns while oil doubled and geopolitical tensions escalated. Manager believes fear apex passed, now selectively buying. Exited profitable positions in Amedeo Air and Secure Trust Bank, maintaining disciplined approach to capital deployment. |
| Jan 12 2026 | 2025 Q4 | CARD.L, CMCX.L, KIST.L, MTRO.L, SAGA.L, SMWH.L, STB.L, WISE.L | Banking, contrarian, Data centers, Long/Short, oil, Uk, value |
STB LN KIST LN CARD LN FRMI LN MICC LN |
Kernow delivered 16.4% in 2025 through contrarian value investing in mispriced UK equities. Key wins include Secure Trust Bank trading at half book value and successful short of AI data centre IPO Fermi. Despite oil supply glut, maintains energy exposure through Kistos acquisition story. Banking-heavy portfolio targets asymmetric opportunities where consensus creates mispricing. |
| Oct 7 2025 | 2025 Q3 | BRBY.L, CARD.L, DRX.L, FRAS.L, GFRD.L, KIST.L, MTRO.L, PETS.L, SAGA.L, W7L.L, WISE.L, WIZZ.L | contrarian, Copper, energy, Long/Short, Luxury, Travel, UK Equities, value |
SAGA LN WISE LN DRX LN |
Kernow delivered 4.7% in September, outperforming since inception with contrarian UK equity picks. Key positions include undervalued Saga benefiting from silver pound demographics, Wise trading at discount to fintech peers, and executing Kistos energy play. Drax renewable transition offers asymmetric upside despite policy uncertainty. Failed copper short highlighted crowded trade risks in green metals narrative. |
| Sep 10 2025 | 2025 Q2 | CARD.L, FRAS.L, GFRD.L, MTRO.L, SAGA.L, SMDS.L, STB.L | Banking, contrarian, regulation, retail, Short Selling, UK Equities |
SMWH LN MTRO LN STB LN MTRO.L WHSM.L STB.L |
Kernow's contrarian UK strategy targets regulatory arbitrage in banking and structural retail weaknesses. Metro Bank's potential MREL exit could unlock £500m capital, driving 33% profit increase. WH Smith short validated by accounting irregularities affecting 21% of profits. Defensive positioning maintained ahead of November tax hikes while seeking opportunities in banking regulation and potential gambling sector targeting. |
| Apr 18 2025 | 2025 Q1 | BKG.L, BRBY.L, CARD.L, GFRD.L, HSX.L, HTG.L, MTRO.L, WISE.L | Buybacks, Capital Allocation, contrarian, Long/Short, United Kingdom, value |
HTG.L BRBY.L GFRD.L BKG.L |
Kernow's contrarian UK equity strategy declined 2.1% in March on trade war fears affecting Burberry, but strong fundamentals drove gains elsewhere. Manager exited Hunting despite 100% returns due to poor capital allocation, focusing on businesses with cash flow visibility and disciplined management. Strategy outperforming UK market since 2019 inception with 52% versus 38% returns. |
| Jan 8 2025 | 2024 Q4 | CARD.L, CMCX.L, GFRD.L, HSX.L, MS, MTRO.L, PNN.L, SAGA.L, STAN.L, WISE.L | contrarian, Fintech, Long/Short, UK Equities, value, water | WISE.L | Kernow's contrarian UK equity strategy delivered 23% returns in 2024 through concentrated positioning in quality companies. Wise leads the portfolio after exceeding wholesale client expectations, while water utility shorts were closed on regulatory changes. The manager maintains high conviction in the differentiated approach despite acknowledging volatility risks in key positions. |
| Oct 30 2024 | 2024 Q3 | CARD.L, CMCX.L, FRAS.L, GFRD.L, HOL.L, HSX.L, HTG.L, MTRO.L, SAGA.L, VID.L, WISE.L | contrarian, infrastructure, Long/Short, small caps, Uk, value | - | Kernow delivered 2.0% in October through successful shorts and selective longs, bringing YTD returns to 16.0%. The UK contrarian manager navigated budget headwinds while benefiting from infrastructure spending via Galliford Try. Portfolio actions included increasing Wise exposure and exiting Videndum. Budget uncertainty resolved, providing stronger market foundation despite profit margin pressures ahead. |
| Aug 31 2024 | 2024 Q2 | CMCX.L, FRAS.L, GFRD.L, HSX.L, JET2.L, MTRO.L, RMV.L | contrarian, Long/Short, tax policy, United Kingdom, value, volatility |
CMCX.L JET2.L RMV.L |
Kernow's contrarian UK long/short strategy delivered 2.3% in August's volatile markets, opportunistically adding to CMC Markets during the panic. The fund rejected attractive opportunities like Jet2 due to long investment horizons and prepared for UK tax policy risks including potential AIM IHT relief elimination. Portfolio upside exceeds 231% with 53% cumulative returns since inception. |
| Apr 30 2024 | 2024 Q1 | FRAS.L, GFRD.L, HSX.L, IP, ITV.L, MNDI.L, MTRO.L, SAGA.L, SMDS.L | Buybacks, contrarian, Long/Short, Mid Caps, UK Equities, value, water |
ITV.L HSX.L MNDI.L MTRO.L |
Kernow's contrarian UK long/short strategy gained 2.7% in March, driven by share buyback activity at holdings like ITV and Hiscox. The manager expects mid-caps to outperform large caps while maintaining short positions in distressed water utilities ahead of anticipated regulatory changes. Strong conviction positioning with 33% cumulative returns since 2019 inception. |
| Sep 30 2023 | 2023 Q3 | CEY.L, FRAS.L, GFRD.L, HSX.L, MNDI.L, MTRO.L, VID.L | contrarian, Elections, Long/Short, takeovers, Uk, value | VID.L | Kernow Asset Management's contrarian UK equity strategy gained 2.6% in November driven by rate cut optimism and takeover activity. The fund focuses on asymmetric opportunities with differentiated theses, maintaining concentrated positions across long and short sides. With 25% cumulative returns since inception versus 17% for UK markets, the portfolio shows 243% collective upside potential. |
| Mar 2 2023 | 2022 Q4 | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
AirlinesAirlines abandoned oil hedging despite oil price doubling, creating operational challenges. Flight cancellations to save fuel are increasing as passengers resist this cost-cutting measure. The manager questions airlines' decision to abandon hedging mid-course without inside information on oil price direction. |
Airlines Oil Hedging Travel Energy |
Aircraft LeasingExited Amedeo Air Four Plus position after takeover bid at 32% discount to NAV. Despite the discount, the position more than doubled since January 2023. The A380 Superjumbo's size creates airport compatibility issues, making it difficult to sell or scrap. |
Aircraft Leasing Aviation A380 NAV | |
| 2025 Q4 |
OilKistos doubled oil and gas production through a Middle East acquisition that was non-dilutive and funded with existing resources. Despite oil dropping 20% in 2025 and Trafigura expecting further declines amid supply glut, the manager is buying more as contrarians. |
Oil Gas Energy Contrarian Production |
Data CentersManager shorted Fermi, a £12bn AI data centre IPO, betting against it at the peak of AI euphoria. The company had no credible balance sheet to fund its build and no clients. The stock dropped 70% within three months and the manager covered the position. |
Data Centers AI IPO Short | |
FinancialsSecure Trust Bank sold a major division for £459m at a premium to book value, providing working capital boost for new lending strategy. The whole company trades at half book value, effectively buying £1 for 50p. CEO has been buying shares with his own money. |
Banks Book Value Lending Valuation | |
ConsumerCard Factory dragged down performance after harsh profit warning blamed on weaker high street footfall. Magnum Ice Cream Company spun off from Unilever owns global freezer network and strong brands but suffers from weak culture and neglected capex. |
Retail Ice Cream Consumer Footfall | |
| 2025 Q3 |
Energy TransitionDrax has executed a herculean shift from fossil fuels to become the UK's largest renewable energy provider, supplying around 5% of the nation's power. The company faces burning questions about new favorable contracts for its assets, as current arrangements involving shipping Canadian forests to burn in Yorkshire upset environmentalists, fossil fuel loyalists, and trees alike. Despite policy uncertainty, Drax has demonstrated its ability to adapt. |
Renewable Energy Biomass Power Generation Policy Risk Adaptation |
CopperThe manager has been betting against a copper miner but the market didn't care and the stock went straight up. Their thesis was based on a cost issue that led to a production miss, but the green metal narrative was too loud and the trade bus was crowded. Copper stocks are up 55% in 2025 against an 18% rise in the metal, the widest differential in just shy of a decade. |
Mining Production Green Metals Crowded Trade Differential | |
TravelSaga took centre stage as its interim results beat expectations, with new management proving it can steer this towards becoming a £100m free cash flow machine. The rise of the wealthy 50+ silver pound demographic may be the most potent and persistent force shaping Western economies today, more predictable than AI and one heck of a long-term tailwind for the travel sector. |
Demographics Silver Pound Cash Flow Management Predictable | |
LuxuryThe wife of the most powerful man on the planet decided to wear a Burberry coat during the recent US state visit to the UK, resulting in a £200m bump in its market capitalisation and fresh proof that the Burberry trench remains a timeless luxury staple. |
Brand Power Timeless State Visit Market Cap Staple | |
| 2025 Q2 |
BankingManager is long Metro Bank following regulatory signals that may allow exit from MREL band, potentially unlocking £500m in capital. Also long Secure Trust Bank after favorable UK car finance court ruling, though provisions may rise from £6m to £20m. Simultaneously short another bank where similar provision escalation would be terminal. |
MREL Provisions Regulation Capital Court Ruling |
RetailManager is short WH Smith, describing it as a low moat business with generic goods, poor presentation, and location-dependent success. Recent discovery that 21% of profits are made up, though viewed as sloppiness rather than fraud. Expects profit warnings and cleanup costs ahead. |
Accounting Fraud Location Moat Profit Warning | |
| 2025 Q1 |
ValueManager focuses on businesses with asymmetric return characteristics trading below intrinsic value. Berkeley Group highlighted as undervalued with strong cash position and forward visibility. Hunting exited as value trap despite 100% returns due to poor capital allocation by management. |
Value Trap Asymmetric Returns Capital Allocation Intrinsic Value Undervalued |
BuybacksHunting had capacity to return nearly 30% of market capitalisation through buybacks with no execution risk, but management chose acquisitions over shareholder returns. This capital allocation decision drove the exit decision. |
Share Repurchases Capital Returns Shareholder Value Management Decisions | |
| 2024 Q4 |
PaymentsWise continues to exceed expectations by adding wholesale clients like Morgan Stanley and Standard Chartered to its traditionally retail-focused FX business. This expansion is three years ahead of expectations and represents a significant competitive advantage through low-cost infrastructure that peers cannot match on price. |
FX Fintech Infrastructure Wholesale Retail |
WaterThe UK water industry's economics remain fundamentally flawed, but recent government price increases have provided short-term certainty. This has enabled refinancings and potential takeovers, changing the investment narrative for water companies like Pennon Group. |
Utilities Regulation Pricing Refinancing Government | |
| 2024 Q3 |
ValueManager identifies significant value opportunities in UK equities, particularly noting Metro Bank and other holdings trading at attractive valuations. Emphasizes asymmetric return characteristics where investment thesis differs from consensus. |
Undervalued Asymmetric Contrarian Mispriced Discount |
Infrastructure SpendingGalliford Try benefits from increased government infrastructure spending following the budget. The company reported 27% revenue growth to £1.8bn and is positioned as a primary beneficiary of the new spending allocation. |
Construction Government Budget Capex Public Works | |
BuybacksMultiple portfolio companies initiated share buyback programs including Galliford Try's new £10m program. Manager suggests buybacks would be preferable to management's capital allocation in some cases. |
Repurchases Capital Return Shareholder Value Capital Allocation | |
| 2024 Q2 |
VolatilityGlobal markets experienced extreme volatility in August with the VIX spiking from 12 to 65, its highest level since COVID-19. Japan dropped 12% in a single session, yet markets recovered within a week. The manager views this volatility as opportunity, increasing their CMC Markets position during the panic. |
VIX Market volatility Fear gauge Trading opportunities CFD business |
United KingdomThe fund focuses exclusively on UK equities with both long and short positions. The manager discusses UK-specific risks including potential tax increases in the October budget targeting capital gains, inheritance tax, and corporation tax. AIM IHT relief elimination is identified as a specific scenario risk. |
UK equities AIM IHT relief Budget Tax policy | |
| 2024 Q1 |
BuybacksMultiple UK companies are engaging in substantial share buybacks, including ITV returning £235m (10% of market cap) and Hiscox announcing a new US$150m buyback program. This demonstrates intelligent capital allocation amid compelling company valuations. |
Share Buybacks Capital Allocation Shareholder Returns Market Cap Valuations |
WaterUK water companies face significant challenges with inadequate infrastructure, colossal capex demands, and mountains of debt drowning equity. The manager holds a short position expecting regulatory and political change over the next 18 months. |
Water Infrastructure Regulatory Change Capex Debt Short Position | |
| 2023 Q3 |
TakeoversUK-listed companies continued to attract takeover interest with eight businesses receiving bids in November, including Hotel Chocolat which received an offer 170% above the previous day's closing price from Mars. This takeover activity demonstrates the value available in UK equities and provides opportunities for the portfolio. |
M&A Takeovers UK Value Strategic |
ValueThe portfolio demonstrates significant upside potential with collective upside worth more than 243%. The manager focuses on contrarian opportunities with highly asymmetric return characteristics where investment thesis is differentiated relative to consensus, suggesting a value-oriented approach to mispriced securities. |
Contrarian Asymmetric Mispriced Upside Differentiated |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Jan 12, 2026 | Fund Letters | Alyx Wood | FRMI LN | Fermi plc | Information Technology | Data Center Infrastructure | Neutral | New York Stock Exchange | AI, CapEx, datacenters, Hype, Shortselling | Login |
| Jan 12, 2026 | Fund Letters | Alyx Wood | CARD LN | Card Factory plc | Consumer Discretionary | Specialty Retail | Neutral | New York Stock Exchange | Competition, Footfall, Profits, retail, uncertainty | Login |
| Jan 12, 2026 | Fund Letters | Alyx Wood | STB LN | Secure Trust Bank PLC | Financials | Specialty Finance | Bull | New York Stock Exchange | Bookvalue, Capital, Insiderbuying, Lending, rerating | Login |
| Jan 12, 2026 | Fund Letters | Alyx Wood | MICC LN | Magnum Ice Cream Company | Consumer Staples | Food Products | Bull | New York Stock Exchange | brands, Distribution, Margins, turnaround, valuation | Login |
| Jan 12, 2026 | Fund Letters | Alyx Wood | KIST LN | Kistos plc | Energy | Oil & Gas Exploration & Production | Bull | New York Stock Exchange | acquisition, contrarian, Oilprice, Production, valuation | Login |
| Oct 7, 2025 | Fund Letters | Alyx Wood | WISE LN | Wise plc | Other | Financial Technology | Bull | NYSE | expansion, Fintech, growth, Payments, profitability, Scalability, UK, valuation | Login |
| Oct 7, 2025 | Fund Letters | Alyx Wood | DRX LN | Drax Group plc | Utilities | Renewable Electricity | Bull | NYSE | energy, growth, Policy, Power, renewables, Transition, UK, valuation | Login |
| Oct 7, 2025 | Fund Letters | Alyx Wood | SAGA LN | Saga plc | Financials | Travel & Leisure | Bull | NYSE | cash flow, Demographics, growth, Insurance, Travel, turnaround, UK, valuation | Login |
| Sep 10, 2025 | Fund Letters | Alyx Wood | SMWH LN | WH Smith PLC | Consumer Discretionary | Specialty Stores | Bear | London Stock Exchange | Accounting Errors, high debt, Low Moat, retail, Short | Login |
| Sep 10, 2025 | Fund Letters | Alyx Wood | MTRO LN | Metro Bank Holdings PLC | Financials | Regional Banks | Bull | London Stock Exchange | Bank, MREL, regulatory capital, turnaround, undervalued | Login |
| Sep 10, 2025 | Fund Letters | Alyx Wood | STB LN | Secure Trust Bank PLC | Financials | Regional Banks | Bull | London Stock Exchange | Capitalized, Car Finance, Provisions, Regulatory risk, Value | Login |
| Aug 31, 2025 | Fund Letters | Kernow Asset Management | MTRO.L | Metro Bank Holdings PLC | Financials | Banks | Bull | London Stock Exchange | banking, Capital Release, MREL, regulatory catalyst, retail banking, turnaround, UK, Value | Login |
| Aug 31, 2025 | Fund Letters | Kernow Asset Management | WHSM.L | WH Smith PLC | Consumer Discretionary | Specialty Retail | Bear | London Stock Exchange | Accounting Issues, Bear, Convenience Store, Operational Issues, retail, Short, Travel Retail, UK | Login |
| Aug 31, 2025 | Fund Letters | Kernow Asset Management | STB.L | Secure Trust Bank PLC | Financials | Banks | Bull | London Stock Exchange | banking, Capital Markets Day, Credit, Motor Finance, Provisions, Relative value, specialist lending, UK | Login |
| Mar 31, 2025 | Fund Letters | Kernow Asset Management | HTG.L | Hunting PLC | Energy | Oil & Gas Equipment & Services | Bear | London Stock Exchange | Acquisitions, buybacks, capital allocation, Management Quality, Oil Services, ROIC, Value trap | Login |
| Mar 31, 2025 | Fund Letters | Kernow Asset Management | GFRD.L | Galliford Try Holdings PLC | Industrials | Construction & Engineering | Bull | London Stock Exchange | Consensus Beat, construction, fundamentals, Revenue Growth, Top Holding, UK Infrastructure | Login |
| Mar 31, 2025 | Fund Letters | Kernow Asset Management | BRBY.L | Burberry Group PLC | Consumer Discretionary | Textiles, Apparel & Luxury Goods | Neutral | London Stock Exchange | Consumer Discretionary, Cross-Border, Luxury goods, Recession risk, tariffs, Trade War | Login |
| Mar 31, 2025 | Fund Letters | Kernow Asset Management | BKG.L | Berkeley Group Holdings PLC | Consumer Discretionary | Household Durables | Bull | London Stock Exchange | Execution Plan, Forward Orders, homebuilder, Management Quality, net cash, ROE Target, UK Property, visibility | Login |
| Dec 1, 2024 | Fund Letters | Kernow Asset Management | WISE.L | Wise PLC | Information Technology | Data Processing & Outsourced Services | Bull | London Stock Exchange | Cross Border Payments, Fintech, foreign exchange, Institutional Clients, Low-cost Infrastructure, payment processing, UK, Wholesale Banking | Login |
| Aug 1, 2024 | Fund Letters | Kernow Asset Management | RMV.L | Rightmove PLC | Communication Services | Interactive Media & Services | Neutral | London Stock Exchange | competitive moat, market dominance, Online Platform, Pricing power, Property Portal, UK Real Estate | Login |
| Aug 1, 2024 | Fund Letters | Kernow Asset Management | CMCX.L | CMC Markets PLC | Financials | Investment Banking & Brokerage | Bull | London Stock Exchange | Brokerage, CFD, contrarian, financial services, market volatility, Online Trading, UK | Login |
| Aug 1, 2024 | Fund Letters | Kernow Asset Management | JET2.L | Jet2 PLC | Industrials | Airlines | Neutral | London Stock Exchange | Airlines, cash generation, Customer-Centric, Cyclical, fleet-expansion, Leisure Travel, UK, Value | Login |
| Mar 1, 2024 | Fund Letters | Kernow Asset Management | ITV.L | ITV plc | Communication Services | Broadcasting | Bull | London Stock Exchange | broadcasting, capital allocation, divestiture, media, Share Buyback, Streaming, UK Equity | Login |
| Mar 1, 2024 | Fund Letters | Kernow Asset Management | HSX.L | Hiscox Ltd | Financials | Property & Casualty Insurance | Bull | London Stock Exchange | high conviction, high ROE, Insurance, Record Profits, Share Buyback, specialty insurance | Login |
| Mar 1, 2024 | Fund Letters | Kernow Asset Management | MNDI.L | Mondi plc | Materials | Paper & Forest Products | Bull | London Stock Exchange | capital allocation, Integration-Risk, M&A, Packaging, Paper Products, value destruction | Login |
| Mar 1, 2024 | Fund Letters | Kernow Asset Management | MTRO.L | Metro Bank Holdings PLC | Financials | Banks | Bull | London Stock Exchange | banking, cost-cutting, deposit growth, recapitalization, ROE Target, turnaround | Login |
| Nov 30, 2023 | Fund Letters | Kernow Asset Management | VID.L | Videndum | Information Technology | Technology Hardware, Storage & Peripherals | Bull | London Stock Exchange | broadcasting, Catalyst, Content Creation, Hollywood Strikes, Media Equipment, mispricing, technology hardware | Login |
| TICKER | COMMENTARY |
|---|---|
| STV.L | Secure Trust Bank largely played out as expected, with an 86% gain. The strategy reset day last month was an opportunity to raise ambition and build something distinctive that would enhance the Kernow valuation. It fell short on both counts. A good bank strategy is simple: be smarter, more consistent, or cheaper. That means stable funding, disciplined lending, tight costs, and capital deployed where you have an edge. Peers are clearer on where they will win. That clarity was missing from Secure Trust. There was not even a slide on peers in its new strategy deck. We genuinely hope there is a cunning plan burbling beneath the surface, leading to a rebrand. Yes, it's a very attractive asset to acquire; alas, we don't do fantasy M&A trades. The shares are now a value trap and will trade at a persistent discount to NAV. We have exited the entire position. |
| RR.L | We still have nightmares about buying and then selling Rolls-Royce in January 2023. If survival keeps you in the game. Dropping a 15 bagger sure keeps you hungry. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
|---|---|---|---|---|---|---|
| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
|---|---|---|---|
| No industry data available | |||