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| # | Fund | Strategy | Style | Geography | AUM | Latest Letter |
|---|---|---|---|---|---|---|
The core thesis of the TM Oberon UK Core Fund is that UK equities are trading at multi-decade valuation discounts relative to global peers, presenting highly attractive deep-value opportunities that can be realized through long-term capital appreciation and corporate M&A. In April 2026, the fund achieved a strong return of approximately 6.9%, outperforming its benchmark sector. This outperformance was driven by positive corporate activity, notably a rejected private equity bid for DCC and a recommended cash acquisition of Animalcare Group, which validated the fund's deep-value philosophy. Although short-term detractors like Imperial Brands and Taylor Wimpey weighed on performance, the manager utilized price weakness to add to positions, emphasizing strong underlying cash flows and recovery prospects. Structurally, the portfolio is heavily weighted toward Financials and Consumer Discretionary sectors with negligible cash reserves. The manager remains highly constructive on the forward outlook, viewing current market dislocations as prime catalysts for future takeover activity and market re-rating.
UK equities trade at historically depressed levels relative to global peers, offering significant deep-value opportunities and compounding returns through capital appreciation and income, validated by corporate M&A activity.
The manager expects UK equities to continue presenting compelling opportunities due to their multi-decade valuation discount compared to international peers. Despite ongoing geopolitical uncertainty, increased domestic and foreign investor recognition, alongside persistent M&A activity, is anticipated to drive a recovery and re-rating across the UK market spectrum.
As of Mar 31, 2026
Richard Penny is a Citywire AAA-rated Senior Fund Director at Oberon Investments who joined the firm in December 2024, bringing over three decades of investment management experience. He previously served as Fund Manager at CRUX Asset Management from June 2018 to December 2024 and spent 15 years at Legal & General Investment Management as Senior Fund Manager from 2003 to 2018, where he achieved outperformance in eight of nine years managing multiple UK equity funds. His earlier experience includes fund management roles at M&G and Scottish Amicable Investment Management, complemented by his University of Oxford education.
Oberon's investment philosophy is based around high conviction, fundamental (value) investing with a size bias towards mid and small caps, where fund managers are co-invested on the same terms as investors. The investment process evaluates companies through three key questions: How good is the business? What is it worth? Does it improve the portfolio? The firm employs a bottom-up, active stock-picking approach targeting growth at a reasonable price or value with a catalyst, maintaining a longer-term investment horizon of two to five years and being prepared to take contrarian positions when market conditions warrant.
Lead Portfolio Manager
Moderate Conviction Bullish
Market Conviction
With 38 total holdings, the fund is moderately diversified, but demonstrates strong conviction through concentrated top 10 holdings representing nearly half the portfolio and decisive actions such as adding to falling positions on weakness.
Growth Outlook
The manager is constructively positive, pointing out that UK equities trade at multi-decade lows relative to international peers, which is attracting increasing investor interest and M&A activity, though they acknowledge the uncertain geopolitical environment.
Risk Appetite
The fund remains highly exposed to equities with a low cash level of 2.5%, and the manager actively added to detractor positions on weakness, demonstrating a strong appetite for risk and value.
Capital Deployment
Cash sits at a very low 2.5%, indicating high capital utilization. The manager actively deployed capital during the month to increase the position in Imperial Brands on price weakness.
Forward Guidance
The manager demonstrates a bias toward action by actively buying shares on price weakness (e.g., Imperial Brands) and maintaining high equity exposure to capture valuation recoveries.
Language Signal
The language is highly constructive and focused on value capture, featuring terms like 'compelling upside', 'deep value', and 'attractive valuation', while balancing geopolitical and inflationary risks.
Perceived Risk
The manager identifies clear macro risks including the US-Iran conflict, energy price volatility, and build cost inflation, but views these as mostly priced into current depressed market valuations.
Opportunity Density
The manager views the UK market as offering a highly dense opportunity set, characterized by multi-decade valuation lows and widespread deep-value dislocations that are triggering active corporate takeovers.
Time Horizon
The investment objective explicitly targets a long-term horizon of five years or more. Commentary on holdings like Taylor Wimpey stresses confidence in the long-term thesis despite short-term headwinds.
Top Conviction Themes
Key Catalysts
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