Angus Tulloch, who was born in Scotland in 1949, bought his first stock at the age of ten. But he didn’t enter the investment business immediately: after studying economics and history at Cambridge he did a variety of jobs, including working as an accountant for the National Bus Company. In 1980 he joined stockbrokers Cazenove and moved to Hong Kong. In 1988 he moved back to Scotland to work for wealth management firm Stewart Ivory (now Stewart Investors). By 1992 he helped set up their emerging-markets business, launching several funds and trusts, most notably the Stewart Investors Asia Pacific Leaders fund, which he managed between December 2003 and July 2016. He retired last year.
What was his strategy?
Tulloch liked well-run firms in an industry with barriers to entry (which should shield them from competition) and that are able to generate strong returns on capital. He avoided investing in countries where he felt investors’ rights aren’t sufficiently protected, or where there was high political risk.
Did this work?
An investment of £1,000 in Asia Pacific Leaders in December 2003 was worth £5,546 by the time Tulloch stepped down 12 years later, an annual return of 14.6%. The same amount invested in the MSCI Asia ax-Japan index would be worth only £3,790, a much lower return of 11.2% a year.
What were his best trades?
Tulloch invested in Hong Kong-listed beverages firm Vitasoy in the early 1990s. The stock has returned almost 3,700% (an average of over 16% per year) since its initial public offering in 1994. A recent example was India’s Mahindra and Mahindra, which he bought in 2012 because he liked its long-term record. It doubled in price over the next four years.
What can investors learn?
Buying well-run firms at reasonable prices and then holding onto them might seem like a very simplistic strategy, but it can be extremely effective, especially when putting money into companies on the other side of the world.
If you want to invest abroad, especially in emerging markets, Tulloch’s approach of avoiding companies run by dubious characters, or where political uncertainty is high, is a prudent way to minimise risk.
